Emergency loans are supposed to save you from emergencies. These types of loans are supposed to help you to cover emergencies. It is advisable to take these types of loans only when you have emergencies. Avoid taking these loans to cover living expenses or luxuries and trips.
It is essential to understand the different types of emergency loans so that you can know what is right for you. You need to remember that most of the emergency loans are short term, and they also have a high interest rate. Here are some emergency loans that you should know:
Tax Return Advance
A tax return advance is a type of emergency loan. If your emergency fund is due in a few weeks, but you cannot wait until it matures, a tax return advance is a good loan option to consider.
With this type of advance, you will be given the money, and it will later be deducted from your tax refund. You will be charged some interest, just like any emergency loan. Fortunately, most of the tax return advance lenders will not look at your credit. They can give you the loan even with poor credit.
Payday loans are short term loans. These loans are taken against your salary. You take these loans so that you can pay them with your paycheck.
When it comes to payday loans, you need to pay them as soon as possible. Failure to pay your payday loans can attract a lot of interest. Always take a loan that you can afford to pay.
Car Title Loans
Car title loans are short term loans, but they can be paid over a longer time. With a car title loan, you use the car title as security for the loan.
In case you are unable to pay for the loan, then your car stands as security for the loan. Since it is a secured loan, the interests might not be as high as the regular loan.
Credit Card Advance
There are credit cards that can allow you to take a cash advance. As long as you have not gone past your credit card limit, you can get some cash, and it will be put in your credit card.
Just like any credit card loan, you have to pay it as promptly as possible to avoid all the interest accumulation and consequences that come with this type of loan.