Sometimes, emergencies occur that require a quick source of money. There are several different loans that are available that will be able to provide access to this money.
1. Small-Dollar Loans
Because of the increasing need for smaller, short-term loans, the FDIC created the Small-Dollar Loan Pilot Program in 2008 that makes money available for loans less than $1,000 at roughly the same ease of access as payday loans, but without the high APRs and fees. The APRs for these loans tend to be between 5% and 36% and are slightly more difficult to obtain, but are usually relatively safe.
2. Payday Loans
Payday loans are short term, high interest rate loans that are available to basically everyone, even if they have a low credit score. They allow a person to take out the money for a fee which is then supposed to be paid back at the next payday, usually within two weeks. The main advantage from companies like Cash 2 Go is that the loan allows the person to get money quickly. However, this money is gained at a high APR and you will end up paying fees.
3. Short Term Small Loans
The National Credit Union Association created the Short Term Small Loan Program that allows credit unions to give members loans that are between $200 and $1,000 for an APR of 28% or less. When an STS loan is repaid, a person's credit score will be raised, allowing that person to access loans in the future for lower rates of interest.
4. Cash Advance from an Employer
Another viable option for a quick loan is by getting a cash advance from an employer. This is usually easy to do, especially if a person is highly thought of in the company. While doing this more than once will negatively affect a person's financial situation and social situation where he or she works, doing it once allows money to be accessed with a minimal amount of fees and risk. There is also no way for the debt to snowball.
5. Secured Credit Card
This type of quick loan requires some advanced planning, but is excellent for those with a poor credit score. Money will be put down ahead of time as collateral that will determine how much credit will be extended. Then, the card can be used for emergencies that would ordinarily require loans. The fees and interest rates vary from card to card.
Do some research to determine which short term loan is the best for your financial situation. Look for low APRs and consider the fees involved with any loans.
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