Thinking Money | Free Financial Advice and Tips

Making it Through a Financial Upset

Posted on 16. Apr, 2009 in Loans and debts

Emergencies and unexpected expenses can creep up on anyone; it’s just a fact of life. You may suddenly have a car in dire need of repairs, someone in the family could become very sick and your mailbox fills up with medical bills, or any number of other situations. You can prepare for times like these, but sometimes event he best preparations doesn’t provide a 100% security blanket. When this happens, what can you do? There are several options. The first one and the best one of course, is getting help from you family and friends. If that isn’t a possibility, then you may have to consider a personal loan.

If you have bad credit you may not think this is possible. However, there are some lenders that even give personal loans to people with credit. Don’t expect to be given the most favorable conditions and interest rates though if you have a very torn credit history. If you can, you should always try to get your loan from a credit union or bank. They base their loans, for the most part, of your credit history, employment, and other typical factors looked at for loans. If you’re able to get a loan from one of these places, you will usually get better terms. However, keep in mind you’ll have to have fairly decent credit for them to even consider giving you a loan usually.

If your credit isn’t going to let you get a personal loan from a bank or credit union, then you can try going to a personal loan company. Some of these companies deal extensively with bad credit situations. When you work with a company like this you can usually expect to have to provide some sort of collateral. The good news is that if you have a pretty stable income, employment and have lived at the same residence for a number of years, your chances of being approved are pretty good. It’s especially important for you to carefully review every aspect of your loan agreement before signing anything with a personal loan company. Also, ensure that you are comfortable with and can meet the terms. If you can’t, then you’re only going to end up in more trouble than you are in now.

If you absolutely can not get a personal loan, there other last-resort options to consider. I wouldn’t recommend this in 99% of cases, but sometimes there’s just nothing left to do. You can use some items you have of value to get a temporary loan from a pawn shop. I don’t suggest doing this usually though, because the interest is extremely high and if you can’t keep the payments up you will lose your belongings they are holding for collateral. Another last resort option is a car title loan company or a payday loan company. Again, interests are high. You could lose your vehicle if you fault the loan, which could lead to not being able to get to work and swindling you deeper into financial troubles. If these are your only option, be absolute certain you’ll be able to handle the interest and make timely payments. Carefully used, they could get you out of a bind.

From: Free Credit Report Resource

Tags: bad credit, credit help