If you are like many Americans, you’re living paycheck to paycheck, and the odds are 1 in 50 that you are currently late on your home loan payment or in the process of foreclosure; with this type of financial strain it can take only one small emergency to throw your financial equilibrium out of balance and leave you in a situation where you need cash fast. Regardless of how good your reason is for needing money quickly, be it a sudden illness or you accidentally spent too much buying holiday presents, you need money and you need it fast.
While there are several options you have for accessing cash quickly, they fall into five basic categories. Spend some time reviewing each of the following to make sure that you are accessing the cash you need in the best way for you:
1. REFINANCE: If you own your home, consider refinancing as your first and best option. Refinancing your home can help you get thousands of dollars, even allowing you to take out enough to develop a cushion in your banking account, and, depending on the interest rate you receive when you refinance and the term of your loan, you may be able to avoid an increase in your monthly payment. Of course, when you refinance, you placed your home at risk so only pursue this option if you are certain that your financial emergency is truly a temporary one and one that you are willing to take steps to avoid in the future.
2. SELL: Alternatively, especially if you only need a relatively small sum, you may want to gather some of your smaller assets and sell them, such as through eBay, upon shop, a consignment store, or by placing an ad in your local newspaper or craigslist. On the plus side, you can get rid of clutter in this way and you will not have to pay any interest. However, when you sell in this way, there’s no guarantee that you will get fair market value for your goods; in fact, it is far more likely that you will receive less than market value, not to mention the amount of time you spend in selling in this way.
3. RETIREMENT: If you do not have a home on which you can borrow or assets to sell, consider borrowing off of your retirement. While this is never really a “smart” idea, if you are in financial troubles, you need longer than 90 days to pay back the money, you have bad credit, and you do not own a home or assets you could borrow against, borrowing off of your retirement may be a good option for you. However, if you do so you will have to pay fines, penalties, interest, and taxes, as well as repaying the amount you borrowed.
4. SECURED PAYDAY LOANS: A secured payday loan is a type of loan that allows you to borrow money from a special payday lender in return for securing that sum with collateral, such as your car title. By providing collateral for your loan, you can typically enjoy a fair interest rate. However, the amount you can borrow will be limited by the value of your collateral, and you typically have less than one month to repay the money.
5. UNSECURED PAYDAY LOANS: An unsecured payday loan is a loan that is provided to you typically without a credit check, without your having to put up collateral, and without checking your income. While this may sound like a deal, and in fairness you can typically receive your money within 24 hours, expect to pay high interest and fees as the lender have to be able to absorb the risk of not doing a credit check and not validating your income.
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