Payday lenders offer emergency loans with short terms (one to two weeks). The loan contract will typically state that the borrower must repay the loan with their next check. While this sounds convenient, online payday loans usually feature extremely high-interest rates (up to 400%). Due to the high-interest rate, the Consumer Financial Protection Bureau (CFPB) advises against taking loans from payday lenders.
Home Equity Loans
If you have a house, you can get a home equity loan or home equity line of credit (HELOC). It is a secured loan that uses your house as collateral. If you breach the terms of the loan, the lender could take possession of your home. On the upside, the interest rates of home equity loans are typically competitive, and the repayment period can span years.
Since a personal loan is an unsecured loan, you don’t need collateral to get one. Due to the lack of collateral, personal loan amounts are usually smaller than secured loan amounts. Monthly payment options are available for paying back personal loans. The lender and the loan amount will determine if the loan term will be a few months or several years.
Credit Card Cash Advances
Besides making a credit purchase, you can use your credit card to get a cash advance from your credit card provider. However, most credit card companies charge high fees and interest rates for credit card advances. Also, if the advance causes your credit utilization rate to rise, it will negatively affect your credit score.
Auto Title Loans
Like payday loans, auto title loans feature high interest rates and fees. However, unlike payday loans that do not require collateral, an auto title loan will use your vehicle title as collateral. You can get up to 50% of your vehicle’s value as an auto title loan . If you breach the terms of your loan agreement, you could lose your vehicle.
If your friends or family can’t give you an emergency loan, try getting the money you need from one of these loan providers:
Some online lending platforms offer only personal loans, while others provide other types of short and long-term loans. However, the type of loan you can access will ultimately depend on the online lender’s eligibility requirements. For example, if you have a poor credit score, you ount provided by the online platform.
Unlike traditional lenders, such as banks, an online lending platform will only perform a hard credit check after you accept its loan offer. That means you don’t have to worry about multiple hard credit checks negatively affecting credit scores.
Even better, compared to a traditional lender that can take weeks to provide a loan, the right online lender can give you an emergency loan within a day. Before picking an online lender, go through customer reviews to verify that the lender is reputable and customer-friendly. The lender should also offer competitive interest rates and fees.
You can apply for a personal loan at a traditional bank. However, most banks will only give a personal loan to a customer with good financial standing. If you have a bad credit history, the bank may deny your loan application. That’s because banks try to keep risk to a minimum and a poor credit score suggests that you are a high-risk borrower.
Depending on your standing with the bank, the loan application process may take days or weeks. You also need to submit a lot of paperwork. The long and complicated process is not ideal for someone who needs a loan urgently. On the upside, if you have a stellar credit history, the loan amount you can access from a bank is one of the highest.