There are many circumstances that make emergency loans necessary. Health and dental problems are two of the main reasons people need emergency money. Home and car repairs are two other reasons that a family or individual often need cash fast.
While there are several ways to obtain cash when you need it, each option has its requirements and limitations. There are several options for emergency loans available to you.
Five Types Of Emergency Loans
1. Car Title Loans
Anyone with a car with a clear title or a title that is almost paid off can generally obtain a car title loan. These loans are quite popular since they are easy to get and can provide fast cash. The application process can take a few minutes and is often available online.
Good credit is not a requirement. The car will be evaluated for value to decide how much can be loaned. As a practical matter, car title loans allow borrowers to continue driving the car. Considering that these loans can be funded within 24 to 48 hours, it is not surprising that this type of loan is the choice of many borrowers in need of some emergency funds.
2. Credit Card Cash Advance
Many credit cards allow for cash advances. Using a credit card with this feature is a proven way to successfully obtain a small loan. Immediate cash is available. The obvious downside is that you must possess one of these cards and have available credit left on the card.
Since consumers can use a credit card with credit left on it to pay for almost any product or service, obtaining a cash advance is not usually needed. In the rare cases where cash is required to pay for a necessity in an emergency situation, then a cash advance on a credit card can provide a solution to the problem.
3. Home Equity Loan
A home equity loan is another emergency cash source for homeowners that have enough equity in their home to satisfy bankers. This method takes longer than a car title loan or a credit card cash advance.
The interest rates are generally better though. Many emergencies require cash faster than you can obtain from a home equity loan. It is noteworthy though that a home equity loan can work for some people in certain situations.
4. Pawn Loan
Pawn shops will loan cash in exchange for collateral that they consider valuable. The good news about pawn loans is that the cash can usually be obtained within a few minutes of visiting a pawn shop. For small amounts of cash, pawn shops offer a viable option. Once the loan is paid back, the collateral is returned to you.
5. Life Insurance Loan
Many life insurance policies have a cash value that can be borrowed against. The older the life insurance policy, the more likely that there is a cash value associated with it. While not all insurance policies have a cash value, many whole life policies do have a cash value.
Some of these options are better than others of course. Each of these options for emergency loans are not right for everyone. Knowing your options when you need emergency cash is important. Depending on how long you have to come up with the money, some options for emergency loans work and others don’t. Evaluating the above choices for emergency loans is a good place to start.