Though all of the personal loan myths we’re going to talk about are duds, this one perhaps is the greatest dud of them all.
Yes, many loans on the market must be used for specific purposes (an auto loan must be used to buy a car; a mortgage must be used to buy a house), but personal loans can be used for just about anything (provided it’s legal, of course). There might be some stipulations from the lender, but there won’t be many, and they more than likely won’t affect you.
When you request to take out a personal loan, the number one thing that will affect the bank’s decision to lend to you is your credit worthiness and your debt-to-income – not the reason you need a personal loan.
Of course, that question will come up, but it will be more of a conversational piece than anything else (and, depending on your answer, you might be steered towards a better loan product that suits your needs).
When it comes to a yes or no, the bank is going to look primarily at your ability to pay back the loan and whether you have a positive history with debt.