A personal loan isn’t your only option for borrowing $30,000. Instead, you could go with one of the options discussed next. One of the biggest drawbacks of using a credit card versus a personal loan is that credit card interest rates tend to be higher. As of late April 2024, the average credit card interest rate was nearly 28%.Sign Up For A 0% APR Credit Card
However, some credit card companies offer a card to new customers at a temporary 0% APR. That means you can make interest-free payments on your card for the length of the promotional period.
The interest-free period will likely only last 6 – 21 months, though, so before this rate expires, be sure you can repay the total amount borrowed. Otherwise, you could be subject to a high interest rate on whatever balance is left.
Apply For A Home Equity Loan Or HELOC
Homeowners can tap into their home equity to take out a loan. Unlike a personal loan, a home equity loan is secured by your home’s equity. Be careful, though, because if you miss payments and default on the loan, your lender will repossess your house through foreclosure.
You can also use your equity with a home equity line of credit (HELOC), which acts as a credit line you can borrow from over the course of your designated withdrawal period. Your home will likewise act as collateral for a HELOC and could be taken by your lender if you default on payments.
Borrow From Family Members Or Friends
You could potentially borrow a loan on a more informal basis from family members or friends. Family loans are typically arranged between family members without going through a financial institution, but an attorney may still be involved. An interest rate and loan term are discussed and agreed upon by the borrower and lender.
Depending on the conditions of the agreement, repayment dates and payment amounts could be lenient or strict. If you miss payments, your credit won’t take a hit, but you could damage your relationship with the family member or friend loaning you the money.
