Today’s age of technology has made it nigh necessary to own a laptop. Laptops give us access to communication, entertainment, work, education, and other essentials. The cheapest laptops dip below $100, while high-quality laptops can cost over $1,000.
If you want a laptop with solid performance and longevity, various financing options can help you secure your preferred laptop. In this guide, we go over how you can use a personal loan to fund a laptop purchase.
Laptop trends and needs
Much of our world has shifted toward remote work, online education, and internet entertainment in recent times. This has led to more people needing laptops for both personal and professional use.
Depending on your profession or field of study, you might encounter particular software demands or mandatory laptop specifications. Your choices would be limited to laptops that satisfy those requirements, which may also restrict your financing.
Read on to find out the pros and cons of both traditional funding and personal loan funding for laptops.
Traditional financing options for laptops
In-store or online retailer financing options
Many stores offer flexible payment options to help individuals afford the laptops they want. It’s also a good idea to research and compare your desired model at different stores and see which store offers the best financing options. Naturally, buying laptops online will be more convenient since comparison becomes easier.
Using a credit card to buy a laptop is another classic choice for those who need a personal computer. However, it is important to know the risks of using a credit card for a large purchase like a computer. Credit cards often come with high interest rates, so if you cannot comfortably make monthly credit card payments to reduce the balance, you might rack up significant interest.
Manufacturer and brand-specific financing programs
Some laptop brands offer their own unique financing programs. Before buying a laptop, check out what active programs they have, as well as whether they’re associated with any eligibility requirements.
Diving into personal loans for laptop purchases
A personal loan is a lump sum of money that you borrow from a lender, like a bank or a credit union. You can use the funds for a variety of needs and goals, but you need to repay the loan over time with interest.
If you want to buy a laptop, here are the top reasons you should consider using a personal loan to finance the purchase.
Loan funds can be quickly disbursed into your bank account, allowing you to buy the laptop you need without delay. This can be especially advantageous to those who are starting school or work and urgently require a laptop.
Flexibility of laptop choice
Having funds disbursed into your bank account means that you can freely use them to buy the laptop you want. If you aren’t sure which model you want to commit to, the loan funds may be saved for later.
Potentially better interest rates
Personal loans generally have lower interest rates than credit cards. If you have good credit, you can obtain a personal loan with favorable terms, allowing you to save more money in the long run.
Fixed repayment schedule
Most personal loans come with fixed repayment schedules and interest rates. This predictability means that you can more easily budget for your expenses and debt obligations each month.
What factors do lenders consider
When evaluating personal loan applications, lenders consider numerous factors. Here are the main ones they take into account.
- Your credit score
- Total credit utilization
- Income stability
- Type of employment
- Existing financial obligations
- Credit report
In general, the better your credit score and financial stability, the more likely you can obtain a personal loan with lenient, favorable terms. If you have poor credit, it can be more challenging to find a suitable loan.
Benefits of using personal loans to fund laptop purchases
By using a personal loan to buy a laptop, you can enjoy numerous benefits. Here are the top advantages of obtaining a personal loan to fund your laptop purchase.
Those who need a laptop as soon as possible can benefit from the fast funding provided by personal loan lenders. A personal loan can help you achieve time-sensitive goals and meet urgent needs.
Higher quality laptops
High-end laptops tend to be more expensive, but the enhanced performance and longevity are often worth it. Here are just a few advantages of a high-quality laptop:
- Longer battery life
- Better screen quality
- Increased storage and RAM
- Easier to carry around
- Faster processors
- Latest graphics cards
While PCs can be easily personalized and custom-built, most people stick with the laptop that they choose. Because of this, it’s often a good idea to invest in a high quality laptop that can last you years and years.
Most personal loans don’t need to be backed by collateral. If you take out an unsecured personal loan, you don’t need to risk any collateral assets being seized by the lender. As long as you have sufficient financial standing and credit score, you should be able to find a suitable personal loan for buying a laptop.
No high-interest credit card debt
When compared to the average credit card, personal loans typically have lower interest rates. This means that you can expect less interest to accrue over the life of the debt. Before you sign a loan agreement, you also have the chance to negotiate more favorable terms, such as a different loan tenure or lower interest rate. This flexibility can make personal loans preferable to credit cards when you’re buying a laptop.
Cover miscellaneous costs
Other than the laptop itself, you might need financial with other costs. Here are example expenses that a personal loan can help you afford:
- Laptop peripherals and accessories
- Extended laptop warranties
Things to consider before obtaining a personal loan for a laptop
Since taking out a personal loan does put you in debt, it’s essential to consider the various ways a loan can affect you. Here are several key things to consider before you shop for a personal loan.
Total loan cost
You need to know the total cost of the loan, including the interest and any relevant fees. Some lenders will charge you additional penalties, such as if you make an extra payment to eliminate the debt early. Be sure that you are aware of the full cost of borrowing so that you are not caught off guard.
A convenient way to compare the total loan costs of different loan offers is to look at the different annual percentage rates (APRs). The APR is a percentage that expresses the annual cost of taking out the loan, and it takes into various factors, such as:
- The interest rate
- Discount points
- Processing fees
Necessity vs. luxury of the laptop
High-end laptops can easily go for thousands of dollars. The latest-generation, high-quality laptops can cost between $2,000 and $3,000 before tax. Even a laptop with solid performance for basic usage can cross the thousand-dollar threshold.
As you choose the laptop you want to finance, weigh the benefits of the laptop and the cost. Consider what is necessary for your goals. For example, it might be nice to have extra storage, but most people don’t need more than the standard 256 GB. Meanwhile, if you want a laptop for gaming, you might want to invest the extra money into a gaming laptop for better graphics and performance.
Compare different loan offers
Different lenders may give you significantly different loan offers. It’s typically a good idea to compare offers from various lenders so that you can get the most favorable rates.
When shopping for the best loan, keep the following in mind:
- The interest rate
- Loan tenure
- Reputation of the lender
- Your income and budget
- Your employment stability
- Existing debt obligations
If you cannot repay the loan or make late payments, you can damage your credit score. This can make it harder to receive credit extensions in the future. For individuals who struggle with budgeting or debt repayment, taking out a personal loan for a laptop may require extra financial planning and consideration.
In addition, when you apply for a personal loan, lenders will make hard credit inquiries (i.e. hard credit checks), which can decrease your credit score by a few points each time. To avoid excessive credit impact, it’s often a good idea to go through a loan pre-qualification or pre-approval process so that the lenders make soft inquiries instead. Pre-qualifying you means that lenders are tentatively willing to give you a loan offer. It can also help you save valuable time.
Alternative means to finance a laptop
Buy now pay later
There are numerous buy now, pay later (BNPL) services that allow you to pay for only a portion at checkout. You will then make regular installments until the remaining balance is completely paid. When you buy a laptop in installments, the cost will typically be equally split over a period of time of your choosing (with certain limitations).
If you’re a student in need of a laptop, many stores and brands offer special discounts or programs for students. For example, Apple, Dell, Microsoft, and HP are a few popular brands that often offer deals to students.
If you work in eligible sectors, you might be able to benefit from professional discounts on laptops and other products. Here are common types of professional discounts:
- Educators and students
- Government employees
- Military personnel
- First responders
- Corporate employees
- Industry-specific discounts
When looking for a professional discount, make sure that you have the necessary documentation and identification to prove your professional status. Even if you do qualify for a professional discount, it’s a good idea to explore your options to see if other discounts or deals might save you more money.
Refurbished or certified pre-owned laptops
Choosing a pre-owned laptop is an appealing, cost-effective option for many. If you’re trying to find a budget laptop, consider a pre-owned laptop.
Some stores allow you to put a deposit on a laptop. You would then begin making installment payments on it. Once you have paid for the laptop in full, you will own the laptop.
While layaway plans can be a good option for some, it does create a delay before you can actually use the laptop you’re paying for. Because of this, BNPL programs are typically more popular than layaway programs for laptops.
A straightforward way to buy a laptop is to use your personal savings. However, make sure you aren’t dipping into your emergency funds unless it is absolutely critical that you get a laptop immediately. If you do use your personal savings, it is also recommended to begin replenishing your savings once again so that you are ready for any unforeseen expenses.
The advantage of using your individual savings is that you won’t need to put any direct debt onto your shoulders. However, this may not necessarily be the optimal choice for those who are looking to buy a laptop.
Laptops play such a critical role in our modern society that it can be hard to navigate life without a functioning laptop (or computer). It grants you access to the digital world in a way phones may not. However, laptops can be a significant financial investment, which means that you should take care to make an informed decision on how to fund your laptop.
Before you buy a laptop, carefully evaluate your tech needs as well as financial stability. Choose the financing option that makes the most sense to you so that you can alleviate the financial impact of buying an expensive laptop. Even if you choose to buy a budget laptop, comparing deals can still help you make the most out of your money.
Resources and further reading
If you’re interested in finding a reputable lender offering personal loans that are suitable for laptops and other electronic purchases, consider the following:
It’s typically a good idea to pre-qualify for loans and/or compare loan offers before making a final loan decision. That way, you can minimize the impact on your credit score as well as the amount of interest you need to pay.
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