There are occasions in your everyday living in which you need cash for the late bill or perhaps an emergency cost. However, you may not know where to begin during a usually wearisome and infuriating process.
The good news is, there are many borrowing alternatives. Read below and find out –
1. Banks
Of course, this would be your first choice, as it would be the safest option. They offer many loan products depending on your needs, such as personal or construction loans, and even mortgage products. This would be a good option if you need to borrow a large amount of money or if you just found out that you a huge unexpected expense you need to cover.
Basically a bank loan is, a sum of money that is been given to you by the bank. The type of loan is chosen based on your credit rating and your ability to pay back. There can be secured loans- which are attached to an item of worth that you own, like a car or house/ unsecured. If you want to start a business of your own, then I would recommend a bank loan over anything else, especially if you have your own local bank. The only disadvantage would be the interest rate/bank fees can be a little too much.
2. Social Lending
This is basically like asking a colleague, friend or random individual investor without using an official company as a middle-man. However, it increases the risk, time and effort of the actual loan. These individual investors have money of their own and are willing to lend money with their own interest rates. They meet up in a peer-to-peer online area, when the “borrowers” they show the investor their profile, to determine whether they want to risk giving their money to this person as they don’t have any financial proof.
3. MoneyMe
It is an app, which allows you to borrow money online like other online lenders that offer a payday loan. This is an option if you need money fast, and real fast. It offers loans up to $25000 and you can apply in just three minutes! If your loan is approved by your bank, the money can be in your account in under 60 minutes. There aren’t any hidden bank fees, so that is an added advantage! As you can imagine, when you do it online it would be much faster, and the submission of so many documents, bank history and statements isn’t needed. They use a very secure type of Proviso technology to access your bank statements for the last 90 days to see if your loan can be approved. They re-assure the fact that this type of technology only gives access to read, so nothing to be worried about the security of your money and documents.
4. Public Agencies
Government agencies have large amounts of money, and they can be a good option for borrowing money. They will allow you to borrow a decent amount of money, making sure you pay it back over an extended period of time. It is said that compared to other sources of money you could have, their interest rates are pretty good. However as there is to all the different ways there are, there are downfalls as well. Not everyone would qualify for their loans. You would definitely have criteria to live up to, like income or asset requirements.
5. Credit Unions
They are an excellent choice for personal loans. They are more open to accepting your loan than banks, of course, you would need income to get through, however, they have great rates plus you don’t need a perfect credit score to be in the running. They offer alternatives to payday loans, called (PALS) in amounts not that large but sufficient enough. They work a little different, they tend to include members who can apply for a loan or borrow money that fit a certain community or group only.
Its disadvantage would be it won’t offer you the loan products that the big banks would do. This is a good option for a small scale.
6. Payday Loans
These types of loans are for emergencies, basically, they are short term loans. You get paid a small amount of money, (maybe a few hundred dollars), and you would have to pay it in a couple of weeks, however its best to keep this as your last option, because if you can’t pay the money back, the fees will be piling up until you do once you pass the deadline. You don’t have to have great credit scores or big credit history as it is not a big deal and a very easy task to get approved.
7. Credit Cards
This works by using your card to purchase an item of need, and may the “borrowed” amount later. They are not a long-term source of financing, only to be used when you need money quickly and when you have the possibility to pay back in a short period of time. There are no application fees, or interest if your credit card bills are paid on time at the end of every month. However, there is a big possibility to use a credit card in the wrong way, or basically “overuse” it.
People tend to become greedy and use it for items or services that aren’t necessary and find it hard to pay their bills at the end of the month. This would end in large amounts of interest rates knocking on their day as they continue to delay. Another disadvantage would be the act of borrowing too much from credit cards, and finally have credit card debts would make you have a lower chance of getting official loans from banks or other money lending institutions.
These are a few ways, depending on your situation, that can be approached if you ever need to apply for loans or borrow money.
