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There are plenty of reasons to invest in a laptop, such as attending graduate school or starting a business. Laptops can be expensive, however, and some consumers may need to spread out the cost of the purchase rather than pay it all at once. Fortunately, there are ways to do this, including using a personal loan for a laptop.Read on to learn all about getting a personal loan to purchase a laptop, pros and cons of personal loans for laptops, qualification requirements, and more.
Can Personal Loans Be Used for Laptops?
Yes, personal loans can be used to finance the purchase of a laptop. Many lenders offer personal loans that can be used for any purpose, including buying electronics. Unlike a car loan or mortgage loan that are earmarked for specific purchases, personal loans are flexible. That means you can use a personal loan for a laptop.
How Do Personal Loans for Laptops Work?
Personal loans are usually unsecured loans, which means they don’t require any form of collateral. These loans typically have fixed interest rates and repayment terms, allowing you to borrow the amount needed and repay it over time.When you take out a personal loan, you pay interest to borrow the money. You pay back the principal balance of the loan plus the interest in monthly installments until you pay off the loan in full. The shorter the length of a personal loan, the higher your monthly payment will be, but you’ll end up paying less in interest over the life of the loan.
Pros of Using Personal Loans for Laptops
There are a number of advantages to using a personal loan for a laptop, such as:
Spreading out the cost of a large purchase
Getting lower interest rates than you would with credit cards
Consistent monthly payments
Building your credit score by making on-time payments and improving your credit mix (the different types of credit you have)
Cons of Using Personal Loans for Laptops
There are also some disadvantages to using a personal loan to buy a laptop that you should be aware of, including:
Students can use personal loans for laptops as long as they qualify. Most undergraduate students, though, haven’t yet built up a strong credit history and credit score before they head college. Graduate school students, on the other hand, may have built up enough of a credit history during their undergraduate or early working years that they can qualify for a personal loan. Students can use those funds to buy a laptop to complete their coursework while attending law school, medical school, or business school.
In-House Laptop Financing vs Personal Loans for Laptop
Another option for financing a laptop is using in-house laptop financing provided by the store you’re purchasing from. Here’s how in-house financing for a laptop differs from a personal loan.
In-House Financing
Personal Loan
Interest is often deferred as a promotional offer
Interest kicks in right away
No interest paid if balance is paid off before promotional period ends
Paying off the loan early can help you save on interest
Offered by the retailer
Offered by banks, credit unions, or private lenders
Personal Loan Requirements
To qualify for a personal loan, a borrower generally needs to meet the following requirements:
Good credit score. The higher your credit score is, the more likely you are to qualify for a personal loan and get the best interest rates.
Consistent income. Lenders want to see that you have a steady source of income to pay back your personal loan.
Low debt-to-income ratio. Your debt-to-income ratio (DTI) is your gross monthly income compared to your monthly debts. Generally, the lower your DTI, the better, as that indicates that you aren’t taking on more debt than you can afford to pay off.
Healthy credit report. This shows lenders that you have a track record of paying off debt and making your payments on time.
Personal Loan Approval Time
Different lenders have different personal loan approval times. Typically, once you apply for a personal loan and meet the lender’s requirements, the personal loan approval time can be fairly quick. In many cases, it takes just a few business days. Some lenders even offer next-day or same-day approval. Check with your lender about their specific timeline.
Alternative Laptop Financing Options
In addition to a personal loan, there are options to financing a laptop you may want to consider. These include:
In-House Financing
As mentioned earlier, some retailers that sell big ticket items, like laptops and furniture, offer in-house financing. In-house financing typically comes with a promotional offer of deferred interest for a set period of time. If you pay off your balance in full before the promotional period ends, you won’t pay any interest at all. However, if you don’t pay off the full balance, you will need to pay all the interest that began accruing from the day you started financing. The interest rate for in-store financing is typically high, so this is something to be aware of.
Credit Cards
Credit cards often come with high interest rates. One option you might consider is to open a new credit card with a 0% APR introductory rate, buy your laptop interest-free, and pay it off before the introductory period ends. Recommended: How to Find the Right Credit Card
Buy Now, Pay Later
Buy now, pay later financing makes it possible to spread out the cost of a purchase without having to pay interest. Usually, you pay a certain amount upfront and then pay the rest in installments. The payments are often interest-free, but only as long as you make them in full and on time. If you miss a payment, you may be charged a late fee.
The Takeaway
If you’re in the market for a new laptop and you don’t have enough cash to pay for it, you can use a personal loan to purchase it. This can help spread out the laptop payment over time, making it more affordable. Personal loans do come with interest charges, so this is something to consider. You’ll also want to make sure that you can pay back the loan regularly and on time. If you’re looking for a personal loan, Lantern by SoFi can help. With just one application, you’ll be connected to our network of lenders to find the best rate and terms for you. Check your rate today with Lantern!
Frequently Asked Questions
Can you get a personal loan for a laptop?
What are the requirements to get a personal loan for a laptop?
How long does it take to get approved for a personal loan for a laptop?
Photo credit: iStock/artisteer
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About the Author
Jacqueline DeMarco
Jacqueline DeMarco is a personal finance writer and editor based in Southern California. While she spends the bulk of her time writing about complex financial issues, she also tackles a variety of subjects ranging from food to fashion to travel. Her work can be found across dozens of publications such as Credit Karma, LendingTree, Northwestern Mutual, The Everygirl, and Apartment Therapy.
