When sudden emergencies come up, a credit card cash advance may feel like the easiest option. They don’t require paperwork or good credit and are easy to access from the nearest ATM. But remember that not only do cardholders pay higher interest rates on cash advances, but unlike other credit card expenses, cash advances incur interest from the day they are withdrawn. This can make them more expensive than other types of loans. But these days, anyone looking for a small loan has several options to choose from. Consider these loans before opting for a credit card cash advance:
Try a payday loan
A payday loan is a short-term loan that borrowers can repay once they receive their paycheck in two to four weeks. Typically, payday loans don’t involve as much paperwork as traditional personal loans, so they can be faster and easier to secure. They also don’t require a high credit score, which makes them more accessible.
Pay with a credit card
Emergency expenses don’t always require cash. Medical bills and utilities can usually be covered using a credit card. Some small businesses or individual professionals – such as a handyman or a plumber – may be willing to accept credit card payments in some cases.
It may help to ask whether you can pay with your credit card beforehand, as well as about any charges associated with credit card payments. Some businesses may charge a convenience fee to customers requesting credit card payment options – this charge may be a percentage of the overall transaction. You may want to consider other options if convenience charges apply.
Get a pawn shop loan
Some lenders, such as pawn shops, may offer a loan against something of value, like a watch, antique item, or jewelry. Some pawn shops may also be willing to accept items that can easily be resold, such as smartphones, power tools, or gaming consoles. After appraising your item, the pawn shop will offer you a loan amount worth a percentage of its value, and you can pay back what you owe within an agreed-upon time period.
Keep in mind that you may risk losing the item if you can’t repay the loan. So, depending on the item you want to pawn, you may decide that it’s better to sell the item rather than borrow against it.
Consider a car title loan
Car title loans are collateral loans that allow you to borrow against a car you own. Depending on the lender you borrow from, you may be able to borrow around 25 to 50% of the car’s value. If approved, you can keep driving your car, and you’ll likely need to repay what you owe in a few weeks or months. With this option, it may be a good idea to compare lenders and seek out the lowest interest rate you can get.
Borrow from friends or family
A friend or family member may be willing to lend you a short-term loan without interest to help you get through the month. Though you may benefit from an interest-free loan, remember that borrowing from a close relative or friend can affect your personal relationship with them if you don’t repay what you owe. So, it’s smart to put the agreement in writing and return the money as soon as you can to avoid any awkwardness or resentment in your relationship.
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