You’re suddenly faced with an R5000 car repair bill. You don’t have the money to pay to have it repaired. But you will after you get paid.
The problem is that in order to get paid you have to keep going to work. How are you going to get to work without your car? Public transport isn’t always the best option.
This is just one of many scenarios you could face where you need a bit of cash fast. What do you do?
Lucky for you, there are several ways that you can borrow money fast. Let’s take a look at 7 of them.
Friends and Family
Asking to borrow money from a friend or family member is most likely the cheapest and fastest loan you can get. But you have to tread carefully to avoid damaging the relationship.
There are various methods of getting cash fast, and we’ll touch on a few, but they often involve extra charges for speed. A friend or family member (usually) won’t charge you those exorbitant fees. Plus, they can typically give you the cash a lot faster.
But keep in mind, they’re not obligated to lend you money if they don’t want to, or can’t. Your friend or family member may not be willing to lend you the cash. If you ask and they say no, that’s the end of it. Don’t get upset with them.
If they do agree, then treat the loan responsibly. Don’t take advantage of their goodwill. Pay it back on time.
It’s also a good idea to outline the terms in writing so there’s no confusion later. Many a good relationship has been ruined over a few hundred rands. Don’t let that happen to you.
An Online Lender
Peer-to-peer lending sites and other online lenders can be a good option. These often have a quick turn around and you’ll see cash in your bank account in a few days.
Interest rates can vary quite a bit depending on your credit rating. If you have good credit, this could be a rather inexpensive option. Especially if you plan to pay it back quickly.
If you have something you can use as collateral, like property, you can get a secured loan. You can often get a much better interest rate on this type of loan. But, you have to pay it back or you will lose whatever you put up for collateral.
Credit Card Cash Advance
This is probably the fastest way to borrow money. It’s super simple too. You can often get a cash advance off your credit card right from the ATM.
Sounds great, right? Sure, but there’s a downside–and it’s a pretty big one. A cash advance from a credit card is very expensive. It depends on the terms, of course, but in general, it is the most expensive option on this list.
You’ll pay somewhere between 2 and 5% of the amount you’re borrowing in fees up front. Then you’ll see a high interest rate, usually around 25% or even higher.
If you carry a balance, it can get even more expensive. Many companies arrange it so that your payments go first to the balance and then to the cash advance. So you pay the higher interest rate for longer.
Auto Title or Pawn Loan
These are both quick ways to borrow money. The terms can vary quite a bit so be sure you know what you’re getting into. Interest rates can be insane, so be very careful.
You can get these loans regardless of what your credit score looks like. That’s because you secure it with a piece of collateral.
If you own your car outright, you can turn over the title to secure your loan. Once you pay off the loan, the lender will return your title. Just don’t default or you’ll lose your car.
A pawn loan works in a similar manner. But you can use anything of value to secure a loan from a pawn shop. People often use jewelry for these types of loans.
Home Equity Line of Credit
If you have some equity in your home, this could be a good option. The amount of equity you have in your home determines the amount of money you can borrow.
This type of loan usually funds pretty fast and the interest rates are very reasonable. But, keep in mind that your home is on the table if you default.
This is also a very flexible option. You can open a line of credit and use it as a revolving line of credit. This means that you can borrow and pay back as much as you like, like a credit card.
Pension Fund Loan
What if there were a way to borrow money from your future self?
There is, (kind of). You can borrow money against your pension fund. This method is both fast and cheap and doesn’t involve checking your credit.
You don’t pay interest on your loan amount. But you do lose out on the interest that money would otherwise be gaining.
Borrowing against your pension fund is also not without risk. If you lose or leave your job, you’ll have to pay that money back within 60 days.
If you are on good terms with your employer, this may be a good option for you. In this method, your employer essentially pays you early.
Talk with your employer to see what they offer. Terms can vary, some employers may limit how much or how often you can ask. Some may even charge a fee.
Your Best Bet to Borrow Money
It depends on your situation which method of borrowing money is best for you. In most cases, however, we can help!
When you apply with us, we will do the work for you. We’ll find the best loan option for you. Save time shopping around and limit those unwanted inquiries on your credit report.
Apply today! We’ll have you out of your quandary in no time!