If you’ve ever found yourself listening to a money podcast or reading a website like this one, you’ve probably seen or heard the term “personal loan.” There’s a good reason for that, as they’re often a great way to consolidate debt or pay for unexpected expenses.

In order to know whether a personal loan is the right choice for you, it’s necessary to understand exactly what it is. Generally speaking, it’s a fixed amount of money which is lent to you at a fixed rate for a fixed amount of time.

A high credit score usually gets you a better interest rate, but many lenders also look at your employment and education history when deciding whether to give you a loan. Loan amounts and durations vary from lender to lender, so it’s important to compare before committing.

Before you do any research, you should determine whether you’re a good candidate for a personal loan. Here are five scenarios in which you could likely benefit from one.

1. You’re swimming in credit card debt.

Credit card debt can creep up on you quickly, and it’s possible that you were lured into applying for certain credit cards due to 0% APR offers, balance transfer deals, and sign-up bonuses. Once those perks ran out, you were probably stuck with high variable interest rates.

A personal loan allows you to borrow cash to pay off all your credit card balances, leaving you with just one monthly bill at a lower, fixed rate. Your credit score will likely go up once your balances are paid, as installment loans don’t impact credit the same way that high card balances do.

2. You’re remodeling your home.

Have you always dreamed of adding a wrap-around front porch or a sunroom to your house? Perhaps your kitchen is in need of a major cosmetic update. A personal loan can be great in these situations, as such additions and improvements generally add to the value of your home and can usually be seen as good investments. You also spend a lot of time at your house, so there’s nothing wrong with making some sensible changes that will enhance your enjoyment.

A personal loan can also be a saving grace when you’re forced to make a home improvement you didn’t actually want, like replacing a roof or a hot water heater. While you can certainly debate whether you really want to take out a loan for marble countertops, some household expenditures are simply unavoidable.

3. You’ve encountered major medical bills.

Illness and accidents happen, and sometimes even good insurance plans can leave you with major out-of-pocket expenses. This can be anything from paying a high deductible to undergoing treatment that your insurance simply doesn’t cover. Auto accidents are also a major cause of unexpected medical bills.

The illness of a loved one can also be a major expense, particularly if you find yourself helping with their medical bills or traveling long distances to visit them. Pets can also take a toll on your bank account if they need an expensive medication or an operation.

4. You’re starting a business.

Being an entrepreneur can be exciting and highly rewarding, but start-up costs are often overwhelming. A personal loan could help you pay for a deposit on an office lease, buy necessary equipment, or pay for advertising.

Securing a personal loan to help with those costs can ease some of the stress that you’ll inevitably experience when you start your own business. Another perk is that personal loans through reputable online lenders are usually processed a lot faster than traditional small business loans from a bank.

5. Your car needs major repairs.

Owning a car can be a serious financial burden when things go wrong. While changing a timing belt probably won’t break the bank, a major repair such as a new engine or transmission can set you back thousands.

Taking out a personal loan for car repairs can be necessary if you rely on your vehicle every day and lack the cash to pay a mechanic. However, it’s important to make sure you don’t get carried away and use your loan to pay for cosmetic work or fancy new wheels. Unlike houses, cars don’t appreciate with time — so “fun” upgrades aren’t justifiable with a personal loan.

If you feel as though you could benefit from a personal loan, be sure to go with a legitimate lender and avoid online scams. Remember to shop around for the best interest rate and never accept a loan with a pre-payment penalty. You should also be aware of any upfront costs such as origination fees, and factor those into your calculations.