LOS ANGELES – December 27, 2021 – (Newswire.com)
iQuanti: When you are in desperate need of money, you may be ready to look anywhere for it. But some quick cashout options can put you in financial trouble just to borrow money to cover essential expenses or an unexpected bill. So the next time you’re in a bind and need cash now, here are 3 quick cash options to avoid and turn to instead.
If you are in need of cash and you have valuables like jewelry, artwork, or electronics, then loans from pawn shops may seem appealing. And, if you have an item worth pledging, you can often get the cash in minutes without a credit check.
But the main disadvantage of a pawnshop loan is that you risk losing your item forever if you cannot pay off the loan on time. Add to that the interest rates, which can be very high, and you might have a hard time paying off what you owe. Also, depending on how much money you need, you may need to pawn a higher value item as pawn shops only offer a fraction of the item’s value.
Cash advance by credit card
The appeal of a credit card cash advance is that you can get cash quickly at an ATM without approval, just like you would with a debit card. But this type of short-term loan has several drawbacks.
The interest rate for a credit card cash advance could be up to double what you would pay for regular credit card transactions. Also, when you add the charge for a credit card cash advance, the repayment can be much more expensive.
Credit card convenience check
A credit card convenience check is similar to a regular bank check, but instead of debiting money from your checking account, it adds money to your credit card balance. The problem with payday checks is that fees and interest rates can start to add up quickly.
In addition, managing paper checks always carries an additional risk of physical loss. And unfortunately, the bank may not be willing to reimburse you as they might if you make the purchase with your credit card.
Quick cash alternatives to consider
These loan options may be a better choice than pawn shops, credit card cash advances, and payday checks:
- Installment loan: An installment loan can give you a lump sum of money up front that you can repay over time in fixed monthly installments or installments. If you want a larger loan amount and don’t want to use an item you own as collateral, this option may make sense.
- Cash advance: If you have a regular salary, you may be able to get funds quickly with a cash advance. And since these loans often come with lenient credit score requirements, borrowers who are striving to improve their credit score can still be approved.
- Personal line of credit: A personal line of credit is similar to a credit card in that once approved, you can access an open-ended revolving loan and spend up to the limit. You will then need to make minimum monthly payments until the loan is repaid. One of the main advantages of a personal line of credit is that you will have constant access to money, often at a lower interest rate than on a credit card.
The bottom line
You may find yourself in a situation where you need to get a loan to cover your expenses quickly. But some types of loans like pawn shops, credit card cash advances, and payday checks can be more of a problem than they are worth. Instead, considering options like an installment loan, cash advance, or personal line of credit can help you get the cash you need on better loan terms.
Notice: The information provided in this article is for informational purposes only. Consult your financial advisor about your financial situation.
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3 Quick Money Options to Avoid When You Need Cash Now