If you take out a personal loan from a bank, you typically have the discretion to use the money any way you want. Maybe you want to pay off some debt, plan a special event, or get some home remodeling started. If you have good credit, a personal loan may offer better rates than credit card cash advances, but they’re not always easy to get. Make sure you know what you need to know about personal loans before you apply for one.
1. Personal Loans Show Up on Your Credit Report
Yes, personal loan affects your credit score. Your bank or credit union typically reports your loan application and all your payments, and the loan shows up on your credit report file. If you make your loan payments on time and keep paying down your existing balance, your loan is unlikely to negatively affect your credit score.