There’s technically only one type of personal loan, although there are variations of it. For example, some lenders offer “debt consolidation loans.” And while consolidating debts is one of the main use cases for personal loans, a loan that is specifically designed for this purpose may include features such as the ability to have the loan proceeds directly sent to the borrower’s other creditors.
There are also personal loans designed for specific purposes. For example, there are loans for home improvements and swimming pool construction with significantly higher limits and longer repayment terms than traditional personal loans.
Are credit cards or personal loans worse for credit?
