| Welcome Back!!
Real quick, I need to ask you something… Would you rather have a debt that has a 28% interest rate or a 9% interest rate? | The 9%, right? | Yeah, because it’s lower and easier to pay. That's what a personal loan does.
Everyone hates on them because they think personal loans = more debt. But over here, we’re Responsible Adults and we don’t think that way!
Today we’re covering how to finesse with a personal loan, and at the end I’ll give you some tips to find a good one :) | “Personal Loans are HORRIBLE”
The people that hate personal loans are usually the ones that got burned by them in the past. They got a loan, but then put themselves BACK INTO credit card debt.
Yeah, that sucks. I’d be pissed too. | But here's what's actually happening when you use a personal loan to pay off credit card debt 👇
You're not adding debt. You're moving it. From a high interest rate to a lower one. You can think of it like you're getting your debt on sale.
I’ve seen people’s 29% interest get cut down to a SINGLE DIGIT interest rate like 5.9%
Here’s what ur gonna do…
Money is a game of chess, and there’s a way to play with a personal loan, but you have to know what you're doing.
If I had credit card debt right now, and I used a personal loan, 2 things would happen…
1️⃣ My interest rate would go down
2️⃣ My credit card usage would also go down
For those of you that don’t know, on your credit you have something called credit card usage/utilization. It’s basically a percentage (%) of how much credit card you’re using.
Normally people say to keep it below 30%, but in all reality it’s actually 10% usage.
When you use a personal loan to payoff your cards, you move your debt from credit cards to a loan, so your usage drops to 0%, which is good!!
The minute you go below 10%, your credit score flies! 📈
If you’re super duper smart, you pay down that loan for 6-8 months. You can go back and get another loan to payoff the current one, but at an even lower interest rate. Since your credit score went up, you’ll probably get better rates going forward! It’s a crazy play. | |
What Would Stack Do?
Stack would look around at personal loans without running his credit to see what’s out there. But there is a very specific way to do this…
You DO NOT go on Google and type in “best personal loans” and then click the first one you see. You’re gonna end up applying and getting annoyed with spam phone calls and emails.
You wanna go the more traditional route and open a free bank account somewhere and check there. Let me show you an example.
Let’s say you wanted to check for personal loans on SoFi
1. You would go open a checking account at SoFi: LINK HERE
2. Click where it says OPEN AN ACCOUNT
3. Fill it out and become a free customer
4. Once your account is open, go to the App Store and download the app
5. Log in to your new account
6. Check for personal loans under your new account
Congratulations, now you get discounts on the interest rate for being a customer AND you don’t get those annoying ass calls 🙂 Oh and it won’t affect your credit check around!
| Go be a Responsible Adult ❤️
Mikey (& Stack 🦥) | |
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