Do you frequently find yourself with plenty of month left, but no more money? When it comes to paying utility bills, are you always robbing Peter to pay Paul? Or has an unexpected expense — a hospital bill, car repair, or other pricey problem — wiped out your emergency savings?
If you answered yes to any of these questions, you might be considering taking out a small loan. Luckily, there are a number of options you can choose from. Read on to learn what they are!
1. Borrow From Your Bank
When most people hear the word “loan,” they automatically think of banks. And they are a great option if you already have an established account with them, you have good credit, and you bring in a steady income.
Loans from banks typically have low-interest rates, but you may need to borrow more than you need. This can spell trouble in the long run.
2. How About a Credit Union?
Unlike large banks, credit unions may offer more flexibility. These are community-oriented financial institutions that often consider loan applications on a case-by-case basis, rather than having cut-and-dried requirements.
You will need to show proof of income for these loans, but they are typically more lenient about applicants’ credit history. Credit unions also offer competitive interest rates and low application fees.
3. Look Into Online Lenders
You can get just about anything online these days, and small loans are no exceptions. Online lenders may be very flexible about your credit report and can evaluate your creditworthiness using other information, as well. A fair amount of competition — and the fact that it’s so easy to see what the options are– means that these lenders will keep their rates fairly reasonable.
Most online loans are unsecured. In other words, you don’t have to put up any collateral. Fail to pay back the loan and your credit rating will suffer, but you won’t forfeit any assets.
4. Try a Title Loan
On the other hand, sometimes a secured loan is exactly what you want. If you have a car, you can borrow against the car’s title. This is known as a title loan, and it is a good option for people who are struggling with not-so-hot credit.
Unlike many other lenders, title loan companies don’t consider a poor credit score as a dealbreaker. Instead, they look at your income as well as the equity of your vehicle.
5. Ponder Pawn Shops
Another type of secured loan is pawning something valuable. Contrary to stereotypes, most pawn shops aren’t sketchy or shady. They are an easy way to get a quick infusion of cash when you need it most. Particularly if you know you’ll be coming into money soon but need a loan to tide you over, this type of secured loan can be a godsend.
You will need collateral, though. Some of the best things to pawn are musical instruments, electronics, tools, jewelry, and sporting goods.
So Many Ways to Get a Small Loan
Running short on cash can be scary. Just remember that there are plenty of options out there, no matter what your credit looks like. The difficult part is figuring out which way to get a small loan is the right one for you. We hope this article has helped! For more information, check out the articles in our Money section.