Every now and then, people find themselves short of something that they need most. Even if you have your work, it does not mean that you are capable of doing everything you want, and get all the things you need. When we are talking about important things in life, basically, we are referring to our fundamental needs in order to survive in this 21st century. You also know that in order to avail these things, you have to work, so that you will be paid for your rendered services.
The availability of the payday loans, business loans, and those personal loans are proofs of the shortages that most people are experiencing, especially in the aspect of financial.
Every time that you will find yourself short of cash, the first thing that will run inside your mind, is to look where you could borrow money. Actually, several methods are available, in which you can get the money that you need. Below are the different ways to borrow money that would surely help you in getting the amount that is required.
• Families and friends-this is the first option that most people are using every time they would be running out of cash. To borrow money from people you truly know is a big advantage, since there will be no interest that will be charged on the money that you will borrow. This is possible, since these people will be willing to lend you money out of friendship or out of the same blood that flows in your bodies.
• Credit cards-this is commonly used for those short-term types of credit. Having this special card is convenient and easy to use, especially if you will be shopping and you forgot to bring cash with you. All you need to do is to charge your bills in the credit card and pay it at the end of month. You also have the option of not paying your full balance, since you can choose of paying the standard APR interest to the respective company of your credit card.
• There is also the balance transfer that happened when you shift the debt from your credit card into the other credit card. There is also the popular cash advance that most people are very familiar with. This is when you get money at the ATM. You can see this kind of method mostly in casinos. However, you should avoid using it as much as possible. It is not only that you are charged of the cash advance fee of 3%, but also the interest that you will have to pay that would range at around of 21%.
• Margin loan-those people who have their stocks or the mutual funds, has the capability of borrowing money from your respective brokerage. This brokerage will be using these stocks to mutual funds of yours as a form of collateral. The interest that one could get using this margin loan is the fact that its interest is much lower than the interest of credit cards. However, there is always the reminder that tells that you should not borrow that much on this type of loan. Since, your mutual funds and stocks are used here as the collateral, there is the tendency that the value of these might depreciate. If that happens, the broker might force you of selling some of your assets in order to decrease the amount of money you owe him.
• Unsecure loan-this is commonly availed by applying in your bank. In case you are not familiar with this loan, an unsecured loan is the money that your bank will provide you after they carefully studied your income and your credit record. They will not be asking any collateral from you, but you will be paying them in the same manner of paying a car loan and mortgage payment. The amount that the bank would release will have to depend on your income and credit score.
Now that you have several ideas where you would turn to, if ever you will need that quick cash, it will be also better if you will make yourself familiar with the terms that you will encounter. Below are the 7 things that you should know that you must look out every time you will be borrowing money.
1. APR-it is the calculation of the interest that will incur in your payment or to the other variable cost. This is usually expressed in percentage of the actual value of the loan’s repayment within the whole year. It does not anyway take into account the charges for late payments and other penalties.
2. Introductory offers-these are the great rates, which are advertised only to see below it the small print, which would tell that it is only applicable for the next 3 months only.
3. Early repayment fees-this is applicable to those who would like to pay the loan early in which they could avail of the charges that would allow them of paying their loans normally.
4. Payment protection plans-asking most experts, they will tell you that this kind of protection plans is nothing but a moneymaking scheme, adding the amount that you can pay over the duration of a particular loan. However, experts will tell you that it would be better if you will pay the fines if ever you missed paying your loan in the right time than paying the protection plans every month.
5. Payment breaks or postpones first payment-there are lenders that will allow you of taking a loan and not paying it immediately in a specific time, which is usually between 3-6 months. There are also those who are very generous that will not charge you any penalties in the few months of your loan each year. This kind of deal is very useful as it can increase the APR only if the income that you have is the seasonal type or the unpredictable one.
6. Secured loans-most homeowners would benefit from the much lower rates by using their homes as their security. This kind of loan is perfect and suitable for those people who have poor credit records.
7. Credit rating-this rate will depend on your honesty and could be derived by analyzing your credit history. However, even if your credit record is not that good, do not worry, as you could still find lenders that will be willing to lend you money.
Borrowing money is not that hard, as long as you know what to do and where to turn to. Running out of cash is a natural thing that happens to everyone, regardless of his status in life. Even if you work hard and stay long hours in front of your computer, it will not change the scenario, and you will still need additional cash for your other expenses.
However, to be in a situation that you are looking where to borrow money is not healthy if it will often happen. For sure, you do not want to experience working 7 days a week only to see your salary passing your palm, as it will all have to be paid for your debts. The best way that you could do to avoid this unpleasant situation is to learn to minimize your expenses each day. This will help you of saving money, which would be used in whatever purposes later.