Loading ...Bad Credit? Good and Bad Financial Solutions When You Need Money Now
Unexpected expenses are just that: unexpected. Even if you have planned for one, chances are you still need a little bit more cash to fully cover the surprise event. While a quick cash injection may be necessary, without good credit it can be very difficult to obtain the money you need, when you need it.
If you find yourself in such a situation, there are a few options to consider.
Just keep in mind that they are not all made equal. With knowledge about each option, however, you will be able to choose the financial solution that’s right for you when you have an emergency.
Installment Loans for Bad Credit
Called installment loans due to the money being paid back in agreed-upon portions – usually, monthly payments – this type of personal loan is a great way to pay for purchases over a longer period of time.
When it comes to getting approved for bad credit loans with monthly payments, the requirements vary depending on the lender, but to obtain a loan you’ll definitely need an active checking account and need to meet a minimum income requirement.
While these lenders may or may not run credit checks, the conditions and terms of your loan will partly be based on your credit history, which is why it is important to examine multiple components of a loan, not just how much the monthly payment will be.
The amount of your loan will be determined by a number of factors you may overlook, such as how many monthly installments there are, which can drastically change how much interest you are paying and how much the loan will cost you in the long run.
Before you agree to any loan, make sure it is the best one for the situation you are in at the very moment.
Cash Advance
In this instance, the cash advance is referred to as applies to credit cards. Credit card cash advances are loans you can take out on your line of credit or credit card. More often than not, there’s a credit card available to you that will cater to your particular needs and credit history.
The loan you are approved for will depend on your credit limit, however, and you should expect interest rates to be much higher than they would be on a standard credit card.
Payday Loans
What makes payday loans so appealing to many people is their convenience; borrowing and accessing cash is incredibly easy for people with limited access to conventional lines of credit. You may have seen lenders on TV, online, and even the mail advertising payday services, almost always providing money without performing a credit check.
Incredibly easy to obtain, these loans may be advertised as helpful but they can put many people in the cycle of debt pretty quickly. That being said, use them only in an emergency after you have tried everything else.
Be wary…
Lenders that offer you emergency loans using without as much as a soft pull or preliminary credit check should be well-researched, as these kinds of contracts usually come with loads of additional fees and very high-interest rates.
Alternative Emergency Loans
There are other, cheaper alternatives you can turn to when you need help, but they aren’t the fastest or most convenient. They also require that you reach out for help at times.
- Explore payment plans for the emergency event or inquire about income-driven plans that are made to help people out in times of hardship. This can be an especially helpful approach when it comes to surprise medical bills.
- Ask local organizations for help. In many communities, there are nonprofits, religious institutions, and charities that offer people help.
- See about getting a paycheck advance or emergency loan from your employer. There are also apps available that offer similar services.
- If you are comfortable with asking your friends and family for a loan, you should consider it. You can work out a loan agreement or go through lending circles. This is a great option if you’re able to get it because you’ll be able to negotiate far better terms for yourself than you could through other lending methods (at least, in theory).
Though asking for help in this manner may not be your favorite thing to do, consider exhausting these alternatives before exploring other types of loans.
Conclusion
When you have an emergency, it is easy to jump at the first opportunity to get fast cash, but that is a mistake. Keep calm and make sure you look at all your options before signing with a lender that wants to put you in a worse position.
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