Over 44 million Americans have taken out student loans, but this isn’t the only type of debt Americans have. According to the New York Fed, at the end of 2017, Americans had a total debt of over $13 trillion. This only means one thing. Many Americans can’t make big purchases with cash. In fact, without loans, at least 70% of colleges will be unaffordable. Below in this article, we will cover the Nine Places to Get Cash If You’re in Need.
Having said that, here comes the hard question. Which is the best place to borrow? We take a look at 8 places you can find the cash you need.
1. Friends and Family Members
Family members and friends are always on speed dial whenever an emergency arises. It makes sense because they are the people closest to you and will understand your situation. In fact, they can offer solutions faster than other forms of borrowing and what’s more, they have few financial requirements.
However, borrowing from this group of people can be tricky at times. The best way to go about it is by putting everything on paper. From the loan amount, repayment period, and the interest charged even if it’s 1%. This way, the contract bonds both of you, and also eliminates potential arguments and misunderstandings. Furthermore, the whole transaction will have a business feel.
Most of the time, borrowing from friends and family members breeds resentment should you fail to repay the loan. This can lead to broken relationships; therefore, tread with absolute caution.
2. Cash Advance
You could be stuck in a financial jam that requires quick cash due to an emergency such as a car repair or a medical bill. In this case, consider taking a cash advance using your credit card. This move will avail you of the much-needed cash ASAP.
While this is a great move to get you off the hook financially, you’ll often have to deal with high-interest rates for the speedy service. That’s not all, because you’ll also have to part with more money as fees. In the long run, this will be an expensive affair. Nevertheless, it’s still cheaper than applying for an online loan.
3. Peer-to-Peer Loans
This is one of the fast-rising forms of lending. As the name suggests, these loans are funded by peers, which means once you apply for a loan, several people will come together to fund it. No banks or financial institutions are involved in this process. The loan and interest are all paid to their peers.
The best part about this form of borrowing is the low-interest rates; this attracts a lot of borrowers. The loan repayment period ranges from 3 to 5 years, a favorable repayment period that won’t strain your finances.
Lending Club is one of the peer-to-peer platforms you can use to take out loans should the traditional financial institutions turn their backs on you. P2P lenders may seem like the best place to borrow money but it’s important to know they have a credit underwriting system.
Chances are you may also have to deal with a high-interest interest rate. In some instances, you may not get enough people to fund your loan. This means you won’t get the whole amount, and you’ll be back to where you started.
4. Online Lenders
Think about it. Tapping a few buttons from the comfort of your sofa to get a loan. Doesn’t it sound good? That’s what online lenders offer at several lender’s finding website. You can get the money as fast as one business day.
You don’t need to walk around with loads of documents. All you need is to enter your personal information, and the lender will consider your application. If you have bad credit, this may also be a suitable option because these lenders work with everyone. Nevertheless, you must tread with caution before considering this option.
The reason is that these institutions are known for charging sky-high interest rates. Don’t be surprised when you’re asked to pay 400% APR or even more. The worst part is, once you get into this cycle, it’ll be difficult to get out. The fees will continue stacking up, and for this reason, it’s recommended that you seek other alternatives first.
5. Credit Unions
Credit unions offer a great alternative to traditional banks. Often, these institutions are located within the community and are more of community banks. This means the immediate community is their main target.
One of the main benefits of borrowing from credit unions is the personal touch that comes with every loan. You see, credit unions serve the community, and they understand your business or situation to the detail.
If you have a question, you can always walk to a nearby branch and sit face-to-face with a human being, who can agree to adjust the loan to suit your situation. Another plus is that credit unions charge low-interest rates compared to banks
With technology taking over every aspect of today’s life, financial institutions must embrace it for customer satisfaction. Unfortunately, credit unions seem to be playing catch-up when it comes to such matters. Therefore, if you intend on paying off the loan online, brace yourself for a huge disappointment. This is bound to change but you still want to ensure they have what you need.
6. National Banks
Capital One, Wells Fargo, US Bank – these are some of the national banks. In fact, you may be one of their customers, which makes it easier to take out a loan because you trust them. However, today, it’s not all about banks anymore.
Several online banks that can offer the same services and products. In addition, they also have countrywide access. Banks with a wide footprint have a lot of options you can choose from. This includes a wide range of terms, incentives, and fees, which means you’re likely to find a product that suits you. Also, these banks are using technological advancements, making it easy to pay online, and they have around-the-clock customer support.
All this sounds good, but the reality is that a big brand doesn’t necessarily mean quality service. For starters, it’s difficult to get one-on-one conversations with a real person. Often, these banks use robots to take care of your queries. Sometimes, you may end up with an inexperienced agent. This means getting flexible options is next to impossible because they follow strict guidelines on borrower profiles and credit scores.
7. Retirement Plans
Do you know you can take out a loan against your retirement savings if you have an employee-sponsored retirement plan? However, there are limits on how much you can borrow. Often, it’s half the balance or $50,000, whichever is less.
Look at it like borrowing from yourself; after all, it’s your money. Any interest you’ll pay will go to your account. Typically, you’ll have five years to pay back the money you took out. The rates are fair and this method can be a great alternative if you have poor credit.
You may be borrowing from yourself but this move will halt the growth on the savings. This will extend your retirement goal by several years. There are age limitations to this method, so be sure to check first, before borrowing.
8. Payday Loans
Desperate times call for desperate measures. This will be the case for you if you have a poor credit score. When emergencies pop up, your back may be against the wall, and this where payday loans come to save the day. You can use your pay stub to get instant cash.
These loans are only suitable when you have absolutely no other means of solving a financial crisis that doesn’t exceed $1,000. Even so, you must tread with caution because while payday loans will get you out of a financial jam, you’ll end up paying insane fees and interest.
Insane because for only two weeks, you’ll have to pay 400% in interest or even more, and this is done as one payment. Make no mistake: even a few hundred dollars will cost ridiculous amounts after adding interest and fees.
Everyone’s been in this situation at least once. You need quick cash to settle several bills. Fortunately, there are numerous options to choose from. However, it’s highly recommended that you find a product that suits your financial situation and always stay alert for high fees and interest rates.