Loans and financing open up whole new options and possibilities for what you can accomplish. However, one of the biggest hurdles to conventional loans and some other forms of borrowing is the time required to process your paperwork. Depending on the type of loan, the loan provider, and your finances, completing the loan process and actually getting approved for a loan can take anywhere from a few days to several weeks. That is a lot of time, and a lot can happen in your financial life during that waiting stage.
While conventional loans and mortgages certainly have their place, some moments require immediate sources of money. That can seem impossible, but there are actually several options for those who need money as quickly as possible. Read our guide below to learn some ways you can borrow money instantly.
A paycheck or salary advance allows your employer to give you part or all of a future paycheck before your typical payday. Paycheck advances are considered a private loan agreement between you and your employer, and how your employer handles salary advances depends on the company’s policies. Some employers offer advances through a third-party lender as part of a benefits package.
Paycheck advances are low-cost and may help you build credit, but they come with their own risks and limitations. These loans do come with interest, but the rates tend to be lower than other forms of borrowing, making it much more accessible to people. Paycheck advances that come through a third-party portal often also come with financial education tools, which can help you understand your situation and identify better methods of dealing with your finances in the future.
However, getting too used to early access to your own money can lead to some bad habits down the line. Most employers grant paycheck advances in emergency situations like:
These advances are also only considered as a last resort option. Most importantly, you should only request a paycheck advance once. Obviously, you can’t always plan for emergencies and unexpected financial setbacks, but do not make a habit of asking for paycheck advances. Generous employers may grant more than one salary advance, but they are by no means required to.
Another drawback to paycheck advances: you are essentially paying interest to borrow your own money. Keep in mind that your future paycheck will also be lower because of the advance. Depending on your work situation, it may actually be more worthwhile to ask for a raise.
If a paycheck advance is truly your last and only option, be careful with your request.
Schedule a private meeting with your employer or write out the full details of your request in a letter. Include general reasons for why you need the advance, how much you need, and how you plan to pay the advance back. You may get denied, or you may have to negotiate your terms.
Payday loans are short-term, high-cost emergency loans that are meant to be repaid by your next payday. These loans usually only provide small amounts of money, typically $500 or less, but that amount can come extremely quickly. Some lenders can advance cash within minutes of submitting a loan application.
The loan is meant to be repaid by your next paycheck, which usually means two weeks.
However, some lenders will allow for debt settlement to be completed within one month. During the loan application process, the lender will typically ask for a signed check or access to your bank account to withdraw money.
The problem with an instant payday loan is that it tends to come with massive interest rates. On average, a payday lender will ask for $15 for every $100 borrowed, which is an APR of 391 percent for a two-week loan. If you don’t repay the cash advance loan in full within the first payment period, the lender will add an extra fee, and the cycle continues. The interest and fees can quickly rack up, leading to huge costs that far exceed the original loan amount.
The reason that the approval process is so quick is that the requirements are close to nonexistent. An instant payday loan generally only requires an income and a bank account. Payday lenders won’t ask for collateral, nor will they consider our ability to repay the loan. Many experts consider payday loans a type of predatory lending for this specific reason, and you should generally pursue other lending options.
While you should mostly avoid payday loans, payday loan alternatives are actually a viable and relatively safe means of getting money pretty quickly with little hassle. Payday alternative loans (PALs) are generally offered by credit unions to their members. Amounts offered usually range from $200 to $1,000 and are repaid after upwards of six months of installment payments.
Similar to traditional payday loans, payday alternative loans do not require a good credit score, but they do look at your income and your ability to repay the loan. Interest rates are also significantly lower with a maximum APR set to 28 percent.
Possible Finance offers even more flexible terms on payday loan alternatives. You can get up to $500 within minutes, even with bad credit, and Possible Finance allows you to easily reschedule your payments without any attached fees. Possible Finance also reports to credit bureaus. This means that, unlike traditional payday loans, payday loan alternatives with Possible Finance actually help to build a more attractive credit history. Along with the usual requirements (regular income, an active checking account, valid identification), Possible Finance also requires:
This all ensures that you are able to repay the cash advance loan while still having enough money to pay for your everyday expenses.
Most people use a credit card on its own, swiping it into a card reader or entering the numbers into an online form. However, some people don’t realize that you can actually withdraw money from a bank or ATM using your credit card. This is a type of short-term loan known as a credit card cash advance.
Unlike withdrawing cash from your checking account, you have to pay back a credit card cash advance, much like you would pay back any purchase made on your credit card. Cash advances are usually capped at a few hundred dollars, meaning you can’t take out your entire credit line in cash.
Although the process is convenient, cash advances can get costly. Cash advances come with fees. These are some of the downsides that come with a credit card cash advance:
Just about every modern credit card comes with a reward system that allows you to accrue points for every purchase. Some of these are a percentage of the purchase or a certain number of points for every dollar spent. Banks and credit card companies often allow you to use these points to purchase airline points and gift cards, pay off statement balances, or “pay with points” systems at checkout for certain merchants.
Along with those options, you may be able to turn your points into cash. The conversion rate can vary, but if you have been saving up those points, it may be worth cashing them out. Read the terms and rules for your credit card rewards program. The amount may get transferred to a linked checking account, or the credit card company may send you a check.
Personal loans from online lenders can be used for anything, making them an excellent option if you need money quickly for a large, unexpected expense. Online personal loans are basically the exact same as loans from a bank or credit union. However, online personal lenders tend to have much faster approval than banks and credit unions. Some online lenders can actually provide you with a secured loan on the day that you apply or on the following business day.
The process is also as safe as any bank or credit union loan. A reputable online lender will still check your credit and income and disclose the costs and terms of the loan to make sure that you don’t take a massive financial hit.
However, as with any personal loan, make sure that the terms and rates work for you. Defaulting on a personal loan of any kind can hurt your credit and may lead to legal proceedings with debt collectors.
If you are in dire straits and truly need money, it may be a good idea to turn to family and friends. This does away with the paperwork and processing, and most friends and family members probably won’t charge interest or require collateral.
However, money matters can get sticky, and if you aren’t careful, you could end up with personal conflicts, hurt feelings, and damaged relationships. If you do agree to take money from a loved one, make sure that you have a plan in place to repay the money. Drawing up a contract can potentially keep people accountable.
There is a wide range of options for borrowing money instantly, and some are better than others. If you need money quickly, consider contacting Possible Finance for a payday loan alternative.