What Are Loans for Emergency Use?

Can you believe that almost 65% of Americans live from paycheck to paycheck?

Without the ability to save money over time, you could end up being vulnerable during an emergency situation. From a medical operation to a car that’s broken down, a single emergency could disrupt your entire life if you don’t know what to do about it.

Are you wondering what your option is? Keep reading to learn all about what loans for emergency use are and how you can get them when you’re in a tough situation.

Personal Loans

Did you know that there is more than one kind of emergency loan? One of the best and most popular options for quick cash during a problematic situation is known as a personal loan. It’s possible to get one or more personal loans from a bank, a virtual financial institution, or even a credit union.

Before you apply for a loan, it’s important to do some research ahead of time so that you know you’re dealing with a reputable vendor. Once you’re approved for the emergency loan, you’ll receive the ask-for amount in a single lump sum. The best loan providers can give you the lump sum by the following business day, although sometimes it can take longer.

Like most loans, it’s expected that you’ll pay it off bit by bit each month. The annual percentage rate will depend on the amount you ask for and the vendor you work with, but you can expect the APR to be as low as 5.99%. In some situations, the APR can end up being 35.99%.

Another factor that can affect the final annual percentage rate is your credit score. The better your score is, the lower your APR will be. If you have bad credit, then you might need to speak with the loan provider about your options.

The Benefits of a Personal Loan

You might be asking yourself why it’s worth getting a personal loan versus some other option. Aside from getting cash as fast as the next business day, you can often get a personal loan without putting forth collateral. If you’re not familiar with collateral, it’s enough to know that it’s an asset of yours that you use to qualify for a loan.

If you’re unable to pay the loan, then it’s within the right of the loan provider to seize the collateral. Collateral could be a vehicle, a home, or something else. Since personal loans often don’t require them, you won’t have to worry about this happening to you.

Yet another benefit of personal loans involves the payment terms. Depending on the loan provider you work with, you may have some flexibility.

Now that you’ve learned about the option of a personal loan, you might be wondering how to get a loan when you need it. Online applications are often simple and shouldn’t ask for anything more than the most essential and relevant data. 

Payday Loans

Aside from a personal loan, payday loans are also designed to help you during an emergency. One of the biggest differences between these two options is that payday loans tend to be much smaller, oftentimes no more than a few hundred dollars. Aside from the amount, the time in which you must pay the loan back is often shorter than payday loans.

While the exact payment plan can differ depending on the circumstances, many people are required to pay the loan off within a couple of weeks or whenever their next payday is.

Since payday loans have massive interest rates, they’re seen as predatory by most financial experts. The interest rate on a payday loan can end up being as high as 300% or even higher. Of course, if you can’t pay the loan back in time, then you can expect to be burdened with even more fees.

This vicious cycle is best avoided by opting for a personal loan instead. That way, when you get a loan, you won’t have to toss and turn at night wondering how you’ll ever pay it back on time.

How to Find the Right Vendor

The last thing you’d want to do is attempt to get a personal loan only for it to end up being a scam. There’s also the risk of getting a loan that has too high of an interest rate. That could leave you in a worse position down the line than during the first emergency.

Instead, you should do as much research ahead of time as possible. Aside from finding out concrete details relating to annual percentage rates, it’s also a good idea to look up reviews from previous customers. This will give you a much better idea of what to expect from their services.

Are you still on the fence about applying for a fast loan? Another way you can feel more confident is if you contact the loan provider and ask as many questions as you can about the process, for instance. If they aren’t responsive or forthright, then you can count that as a red flag.

After all, the best loan providers have customer service you can rely on no matter what. You can also ask for recommendations from family members and friends. There’s a good chance that at least one person you know has had to take out a loan during an emergency.

Now You Can Get Loans for Emergency Use

Now that you’ve learned all about what loans for emergency use are, you can rely on them if you ever find yourself in a tough situation. With the world being as unpredictable as it is, it’s comforting to know you can have something to rely on in case the unexpected happens.

FastLoanDirect is the best place to get quick emergency money in the form of a personal loan. Whether you need to pay an outstanding bill or your boat has broken down, we can help you get the money you need. Get started now by clicking here.