Getting stuck in a financial rut can be overwhelming, especially when monthly payments are made with little-to-no funds to cover everything. Your pockets have too many holes at this point and when you can no longer rely on your paycheck, taking out a loan is the next best solution.
Unfortunately, borrowing money also comes with a high price tag. While it can provide short-term relief, you may find yourself deeper in a quicksand of debt if you borrow a loan you can’t afford to pay down the line. That’s why before you jump on the first loan offer you see, it’s best to consider your options to pick the best terms that fit your financial situation.
Exploring Affordable Ways to Borrow Money
1. Personal Loans
One of the best loan options for covering emergency bills, home improvements, and other unexpected, daily finances is personal loans. Compared to other fast loans, personal loans are one of your safest bets since the term involves a fixed amount of money that you can repay between one to ten years.
A fixed-term loan makes it easier for you to plot out your budgeting and meet monthly payments, plus the unchanging interest rate means you won’t run into costly surprises along the way. Like any other loan, a good credit score of at least 690 and above can give you an advantage since it increases your chances of getting good payment terms.
In case you have a less-than-ideal FICO score, you can always go to credit unions instead of traditional banks since they’re more willing to consider your financial situation. Keep in mind that you first have to apply as a member of a credit union to reap the benefits!
2. 0 Percent APR Credit Card
If you want to borrow money without dealing with the interest rate, taking out a zero percent APR credit card makes it possible and easy to get the funds you need for the first 18 months. This introductory period opens the opportunity to cover unexpected expenses like car repairs, medical bills, and more, all of which you can pay for within nine months.
If your balance moves past the introductory period, the next ongoing monthly payment will be charged with an interest rate. Such a sweet deal, of course, is only given to borrowers with an excellent credit score of 720 or higher.
3. 401(k) Loan
If you don’t have an impressionable credit score and find it tricky to look for the right lender to provide you with financial support, then taking a loan out of your 401(k) retirement plan is right up your alley. Since you’re technically borrowing from yourself, you don’t have to worry about taxes and other associated penalties.
Missing payments won’t compromise your credit score, too, though it’s important to avoid missing payments since you’ll be affecting your retirement nest egg. In case you lose your job sometime in the future, you have to pay off the remaining balance or else it will default.
The Bottom Line: Exploring Cheap Loan Options You Can Afford to Pay
Loans offer a silver lining to anyone strapped for cash since it lets borrows like you get enough financial support to pay for unexpected emergencies, medical bills, necessary home repairs, and other surprising expenses life throws at you. The list above shows one of the best options for affordable loans, which cater to different kinds of borrowers with unique needs.
Are You Looking for the Best Installment Loans in Memphis, TN?
If you're looking for a finance company that offers fantastic deals when it comes to personal loans in Memphis, you've come to the right place. Shelby Finance Company can ease your financial woes by offering a variety of personal loan sizes, so you can find the best deal that suits your needs.
Contact us today at 901-542-8212 to see how we can help you obtain an affordable payment plan with no hidden fees to worry about!