When you’re short on money, the absolute last thing you want to do is pursue the first opportunity for cash you find. Companies that send out loan solicitations using spam tactics are usually the first you should avoid.
But there are legitimate ways to get a cash advance loan that could get you out of a jam quickly. Take a look at this guide to when and how you can get a cash advance loan.
When to Get a Loan
There’s an ongoing debate among personal finance experts over when loans are a good idea. Many experts argue that emergencies and loans don’t mix.
But in the real world, people have problems that could spiral out of control without the help of a cash advance loan. For instance, given the choice between getting evicted in the dead of winter with a newborn and taking out a loan, most people would choose to get a loan without a second thought.
It’s important to make getting a loan a personal choice based on your available options. If you’re mistaken in believing a cash advance loan is ‘free money,’ it’s best to steer clear.
What is a Cash Advance Loan?
A cash advance loan goes by many names. Some people use an advance from a credit card to get access to cash quickly.
Others turn to payday lenders to get a few hundred dollars to hold them over between pay periods. Expect fees to be high on these types of loans.
Lenders understand that you’re in a financial emergency which means you don’t currently have the means to repay the debt. This makes you a high-risk borrower.
In order to ensure they make their money back on the loan, lenders charge higher interest rates and fees with cash advance loans.
This is the reason some financial experts warn consumers to stay away from fast money.
Alternatives to a Cash Advance Loan
The most important question you need to answer when thinking of getting a cash advance loan is what are your other options. Sometimes it’s a lack of knowledge that backs you into a corner in the first place.
There are viable ways to raise a small amount of money without help from a cash advance loan. The first is to borrow from friends or family.
Consider whether pride is the top reason you’re steering clear of this low-cost loan option. The second option is selling personal items.
You can sell just about anything in the free classifieds. Consider reselling popular technology using sites like Decluttr or Craigslist.
You won’t get rich, but you also won’t get a large sum of money from a cash advance loan.
How Loans Can Save the Day
When you’re mind is overwhelmed by stress during an emergency, you just don’t have the energy to be strategic. Get a cash advance loan when brainstorming solutions isn’t an option.
You can find ways to get out of a debt trap but in extreme emergencies involving the people you love, you can’t risk their health or safety. For more information and tips, visit our blog for updates.