There can be many reasons why you may take out a personal loan. Here we explore the importance of product recommendations based on your credit profile.
When it comes to personal loans, the word personal is key. It may be a smart decision, if it suits your financial situation. For example, it might help lift you out of credit card debt – if lower interest rates help you pay off those debts more quickly. Or if you’re about to buy a big purchase – a car or a holiday, perhaps – a personal loan may be less expensive than a high interest credit card. It might also help you build credit, if you can generate a record of punctual payments. If you do decide it’s the right choice for you, there are a lot of options out there.
Too much choice?
It’s likely you receive a deluge of credit offers on an almost daily basis, either in the form of junk mail hitting your inbox, snail mail landing on your doormat or the unidentified caller at the end of the phone. The choice can seem overwhelming and, with so many of us borrowing and so many different rates and deals out there, it really is hard to see the wood for the trees. It’s also important to note that these unsolicited offers you’re receiving do not take into consideration your individual situation — such as your credit health, your ability to borrow and benefit from preferential rates, nor your capability of paying back.
November 2021: Consumer credit borrowing increased by a net £1.2 billion.
Source: https://www.bankofengland.co.uk/statistics/money-and-credit/2021/november-2021
No one size fits all
When it comes to borrowing money, it is never a case of one size fits all. Your needs are completely your own — and that’s where intermediaries like us come in. We start by showing you your credit score; this is an integral part of your financial health. Your score is based on factors like your payment history and how much of your available credit you’re currently using.
Our aim is to offer you value by making product recommendations based on your credit profile. And, if you’re not eligible for these personalised card and loan offers right away, there are steps you can take to help boost your credit score over time.
Is Credit Karma really free?
Now you know about some of the services we provide, you may well be thinking it’s simply too good to be true and be wary of any hidden costs. But there are none. If you choose a product through one of our recommendations, it’s the bank or lenders that pay us, not you. Rest assured, we will never sell on your personal details; it’s against our private policy and we detest those tactics as much as you do. Instead, we stay free by featuring offers, like credit cards and loans on our site. When you take up an offer through Credit Karma, we are paid a commission from our partners — this might be the bank that issues the credit card or the lender who funds the loan. We’re a broker, not a lender, and we’re also independent — so we’ll never rank offers based on commission.
We’re continuously working to expand the panel of lenders we partner with, to make sure you get the widest range of personalised offers possible through our marketplace.
Bottom line
If you do decide that borrowing some money fits your unique personal financial situation, Credit Karma can potentially guide you towards a solution suited to your needs — and importantly, with confidence in your ability to pay it back.