Everything You Need to Know About $1,200 Personal Loans

Everything You Need to Know About $1,200 Personal Loans

If you need to borrow a relatively small amount of money, a $1,200 personal loan can be a good option. These loans provide quick access to cash that can be used for a variety of purposes. Whether you need to cover an unexpected expense or make a small purchase, a $1,200 personal loan may be able to help.

In this comprehensive guide, we’ll cover everything you need to know about $1,200 personal loans, including:

  • How $1,200 personal loans work
  • Where to get a $1,200 loan
  • Typical requirements
  • Pros and cons
  • Alternatives to consider

How Do $1,200 Personal Loans Work?

1200 personal loan

A $1,200 personal loan is an unsecured installment loan that provides you with a lump sum of $1,200 which you then repay over a set fixed monthly payments, typically over 1-3 years. The loan is unsecured, meaning you don’t need to put up any collateral.

Key features of $1,200 personal loans include:

  • Fixed interest rate: The interest rate remains the same fixed for the life of the loan
  • Fixed monthly payments: You’ll make the same payment each month
  • Repayment term: Usually 12-36 months
  • No collateral required: The loan is unsecured
  • Funds deposited quickly: Often within 1-3 business days

The interest rate you receive will depend on factors like your credit score, income, and debt-to-income ratio. Rates typically range from about 6% to 36% APR for $1,200 personal loans.

Where Can You1,200 Personal Loan?

There are several options for obtaining a $1,200 personal loan:

Online Lenders

Many online lenders offer personal loans starting at $1,000 or $1,500. Some top options to consider include:

  • Upgrade
  • Upstart
  • LendingClub
  • Best Egg
  • Avant

Online lenders often have quick application processes and fast loans within 1-3 business days. They may also be more willing to work with borrowers with fair or poor credit.

Banks

Some traditional banks offer personal loans, including options for $1,200. Major banks to check include:

  • Wells Fargo
  • Discover
  • PNC Bank
  • U.S. Bank

Bank loans may offer competitive rates if you have good credit but often have stricter eligibility requirements.

Credit Unions

Credit unions are non credit unions frequently offer small personal loans to members, sometimes with more flexible terms. banks. Check with credit unions in your area to see what $1,200 loan options they may have available.

Eligibility Requirements for $1,200 Personal Loans

While requirements vary by lender, you’ll typically need to meet the following criteria to qualify for a $1,200 personal loan:

  • Credit score: 580+ (fair credit) or 660+ (good credit)
  • Income: Steady source of income and ability to make payments
  • Debt-to-income ratio: Below 40-50%
  • Age: 18 or older
  • Citizenship: U.S. citizen or permanent resident

Some lenders may have additional requirements like minimum annualresholds or bank account verification. Having a cosigner can help you qualify if you don’t meet all the criteria on your own.

Pros and Cons of $1,200 Personal Loans

Consider these advantages and potential drawbacks before taking out a $1,200 personal loan:

Pros:

  • Quick access to cash for li>Fixed monthly payments
  • Lower interest rates than credit cards
  • No funds for almost any purpose
  • Build credit with on-time payments

Cons:

  • Interest costs over time
    • life of the loan
  • High rates for borrowers with poor credit
  • To pay origination fees
  • Risk of damaging credit if you can’t make payments

How to Apply for a $1,200 Personal Loan

Follow these steps to apply for a $1,200 personal loan:

  1. Check b>Check your credit:
  2. Compare lenders: Shop around and compare rates, terms, and fees from multiple lenders
  3. Get prequalified: See estimated rates without impacting your credit score
  4. Choose a lender: Select the lender with the best offer for your situation
  5. Gather documents: Prepare things like proof of income, bank statements, etc.
  6. Complete application: Fill out the full loan application with your chosen lender
  7. Review and accept offer: Carefully review loan agreement before accepting
  8. Receive funds: Get loan proceeds deposited to your bank account

Alternatives to $1,200 Personal Loans

A $1,200 personal loan isn’t always the best choice. Consider these alternatives:

Alternative Best For
Credit card Short-term borrowing you can repay quickly
Secured loan Lower rates if you have collateral to use
Payday alternative loan Small, short-term loans from credit unions
Borrowing from family/friends Interest-free borrowing if available

Frequently Asked Questions About $1,200 Personal Loans

What credit score do I need for a $1,200 loan?

You’ll typically need a credit score of at least 580-600 to be approved for a $1,200 personal loan. However, some lenders offer personal loans for bad credit with scores as low as 550 or even no minimum credit score.

How long does it take to get a $1,200 loan?

Many online lenders can approve and fund $1,200 loans within 1-3 business days. Some even offer same-day or next-day funding. Traditional banks may take 5-7 days or longer.

What can I use a $1,200 loan for?

You can use your personal loan proceeds for almost any purpose, including:

  • Bills and debt consolidation
  • Vacations or home improvements
  • Medical emergencies or car repairs
  • Educational expenses

The funds can be used for virtually anything you need cash for.

What are the average interest rates on $1,200 personal loans?

Average rates range from around 6% to 36% APR. The exact rate will depend on your credit score:

  • Excellent (750+): 8-14%
  • Good (700-750): 9-15%
  • Fair (650-700): 12-20%
  • Poor (600-650): 20-36%

These rates are much lower than typical credit card interest of around 14-25% APR.

How do I choose the best $1,200 loan?

To select the right personal loan:

  • Compare multiple lenders
  • Look at interest rates and fees
  • Check repayment terms
  • Consider the lender’s reputation
  • Make sure you can afford monthly payments

Spend time shopping around to find the best deal for your situation.

Mistakes to Avoid When Applying for a $1,200 Loan

To avoid common pitfalls:

  • Avoid applying with multiple lenders in quick succession: This can hurt your credit score. Apply only when you’re ready.
  • Don’t ignore origination fees and other costs: These can add up, so make sure to factor them into your decision making
  • Avoid taking out more than you need: Only borrow what you truly require. Borrowing $1,200 but only needing $800 will cost you extra.
  • Don’t miss payments: This can damage your credit score and incur fees.

Be mindful of these potential missteps to protect yourself financially.

Real-Life Scenarios for $1,200 Personal Loans

Consider a few real-life scenarios:

Car Repair

“I needed $1,200 to fix my car and couldn’t afford it out of pocket. I applied for an online personal loan and got the cash within 48 hours.”

Emergency Medical Expenses

“My daughter broke her arm playing softball and needed surgery. A quick $1,200 personal loan helped cover the out-of-pocket costs until my insurance kicked in.”

Credit Card Debt Consolidation

“I had high interest credit card debt totaling over $4,000 but only needed $1,200 to consolidate it. I took out a personal loan and saved money on interest rates.”

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