Financial emergencies, like a medical bill, car repair, home repair or temporary unemployment, can happen any time. In such circumstances, you will need instant funds to get through these obstacles.
Consider these borrowing options to get quick cash during an emergency:
Payday loans help to address your emergency cash needs. These loans are easy to request and processed faster even with bad credit. You need to complete the online loan request form with necessary details. Once your loan request is approved, you can receive funds into your checking account within one business day.
These loans do not require collateral or checking your personal financial history. However, they come with a higher interest rate and shorter repayment time and should be repaid at your next pay date. You can request your lenders for an extended repayment period if you cannot repay the loan amount in a lump sum.
Personal loans also provide you with immediate cash while offering better interest rates and a flexible repayment period. However, you need to know the details of these loans before deciding whether or not to take one.
Personal loans can either be unsecured or secured. A secured personal loan requires collateral, be it either a property or a vehicle. You will be risking your vehicle or property if you cannot afford to pay back the loan amount on time. Unsecured personal loans do not require any collateral. In such cases, your lenders may check your credit score, income limit, and credit history before approving your loan.
Credit Card Advance
A credit card advance is another option to get fast cash when you need it the most. It offers cash advances through checks, bank withdrawals or ATMs. You will need to pay the processing fee and interest rate for these cash advances. Your cash advance limit determines how much you can borrow.
A lot of people opt for these cash advances because it’s even available for people with low credit scores. However, remember that a credit card advance works like a short-term loan and has to be paid back with interest on time.
Retirement Account Loan
You can consider a retirement account loan if you want to use your own money to solve your financial emergencies. You can take out a loan from the money you have saved in your retirement account or 401(k). The interest rates of these loans are low and won’t impact your credit score.
Repay the loan amount on time. Otherwise, you will need to pay penalties along with the loan amount and interest rate. If you cannot pay back the loan amount and you leave or lose your job, then your loan will be considered as an early withdrawal.
You can request a personal loan from various peer-to-peer lenders or lending websites. However, the interest rates of these loans vary depending on your credit score. If you have a good credit score, you can expect a lower interest rate. Otherwise, you will need to pay a higher interest rate.
Lenders may ask you to submit your recent pay stubs to know whether you make sufficient income to pay back the loan amount on time. Peer lending is quite an appealing option for those who don’t have many other options to cover a financial emergency.
These are a few great borrowing options that will help you in an emergency. However, you need to identify which of these can provide the funds you require as soon as possible.
Robin Williams is an Executive at CashOne, which serves to connect consumers across the U.S. quickly with its authorized lender network. Robin has more than 20+ years’ experience in Administrative Management, with several years in the lending industry.