Emergencies happen. Unfortunately, emergencies tend to happen when we’re least prepared for them. Unless you have thousands of dollars in a nest egg somewhere, you’re going to struggle when a crisis hits. But stop for a second and take a look at your options. Even without a big nest egg you still have options on the table. Here are a few places where you can get cash in an emergency.
Borrowing Money from Family and Friends
This is by far the path of least risk because there are no credit scores or formal agreements in place. That doesn’t mean you should take your family and friends for granted. Attempt to pay them back as soon as possible, and make a repayment plan for them.
In an emergency we all have people who would do anything for us. They’re the people you should turn to for cash in an emergency.
Approach an Online Loan Company
Conventional loans from banks take too long to apply for. In a crisis, you can’t afford to wait weeks for a decision. Online loan companies can be accessed from anywhere and they usually provide a decision within 24 hours. Many of them will even approve your loan in as little as six hours.
For short-term loans you can expect to pay higher interest rates, but these companies are an excellent fallback option in a pinch. You can even get longer installment loans that have more favorable repayment terms. Several websites offer installment loans for smaller amounts generally from $2,500 to $5,000. You can use online comparison websites to find the best deal among online loan companies.
Pull Out the Credit Card
A credit card is a form of borrowing, but they come with reasonable interest rates. And if you pay back the money quickly, you might not have any interest to worry about at all. Like most of us, you may have more than one credit card. Use more than one to cope with an emergency.
Borrowing over 30% of your overall limit can hurt your credit score. One way to get around this is to borrow small amounts from multiple credit cards.
Just make sure you have your math right so you know that you’ll be able to pay back your debts.
Take Out a 401(k) Loan
Imagine if you could take out a loan without it hurting your credit score. Now you can with a 401(k) loan. You can borrow against your retirement fund. How much you borrow depends on your plan and how much you already have in it, but the fact remains you have a strong ally by your side when life hits.
Take note that you must keep your job until you pay the amount back. If you leave your job for any reason you will have just 60 days to repay the full amount. Failing to do so will mean getting hit with an early withdrawal penalty. Only take a 401(k) loan if you believe your position is stable.
Try a Secured Loan
The vast majority of loans you can get in an emergency are unsecured loans. This means that lenders can take legal action against you for that amount of money. A secured loan works differently. Before you can take one you need to put up an item of value first.
A secured loan can work with a house, a car, jewelry, or anything else. Fail to pay back the loan and the lender can sell the item to recover the money. This can be a risky loan, but if you’re sure you’ll be able to repay the money back this is a good option.
Last Word – More Options than You Think
There are more options than you think for getting emergency cash. They all come with risk, but if you know you’ll have the means to pay the money back there’s nothing to fear.
What do you think is the best way to get emergency cash?
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If I ever need an emergency loan I usually get it from my grandmother. I have on occasion borrowed money from her and she has been really sweet about it. I have friends that have gotten personal loans to help them out but they usually have to pay interest. Sometimes it is easier just to sell some things on Craigslist.