Where Can I Get Extra Cash During The Pandemic?

The start of 2020 came as a shock for everyone when the World Health Organization declared the novel coronavirus as a pandemic in March. Countries closed their borders, implemented lockdowns, and stop business operations from fighting the spread of the virus. 

Large and small businesses are affected. Many companies had to implement pay cuts. According to research, 43% of adults have experienced pay cuts or job losses for themselves or others in their household. 

Research also suggests that even if workers go back, the pay cuts may stay longer than expected. Despite having savings and budgets, many are not all that prepared to weather a financial crisis that the COVID-19 pandemic. 

At this time, many households need extra cash to ensure there’s food on the table and bills are paid. Keeping your family’s health and welfare is the top priority. 

Good thing, there are options to keep things afloat until the tide changes for the better. Here are some of the choices you can choose to help with your current finances: 

1. Credit Card Cash Advance 

A credit card cash advance is a loan you incur on your credit card’s available credit. Additional fees are applied to the cash advance loan. It’s a convenient way to get cash in a short period of time. 

Most credit card facilities allow you to withdraw a cash advance from their ATMs. Others use online or phone banking to process applications. Once your application is approved, you can receive your money through a bank deposit. 

Although this is a viable option, it’s important to note that cash advance fees can be high as 5%, depending on the bank or credit card issuer. If you can’t repay the amount in the given deadline (usually after 21 days or when your credit card is due), you will be slapped with additional interest charges. 

Credit card cash advances are ideal when you need the cash for now, but you know you can repay it as soon as possible to lessen charges. It’s also ideal for any type of emergency in which you can’t pay using the credit card itself. Use your credit card instead of getting a cash advance, so you don’t have to pay for the additional transaction fees. 

2. Payday Loans

Payday Loans are a type of short-term loans that are lent with high-interest rates. These types of loans are easy to secure with a high risk to the lenders. So, they are authorized to impose a high-interest rate following guidelines set by the State.

Application for payday loans is easy. There’s no need for extensive credit checks as long as you can provide the requirements, such as proof of identity, proof of residence, and proof of employment. Submit a valid ID, a bill under your name, and a paystub, and you can get approved. 

Despite the easy application process, you need to consider the loan terms of payday loans. Most of the time, you need to repay the loan in its full amount in a minimum period of ten (10) days (or on your next payday). 

Due to the very short time to pay the full amount, most borrowers would resort to paying a minimum amount and have their loan rollover to the next deadline. This adds to the total amount you need to repay. The more you push back on paying the full amount, the more the interest adds up. 

In Texas, you can borrow as high as $1,000 in payday loans. However, the Annual Percentage Rate (APR) can reach up to 662%. Payday loan borrowers get stuck in a cycle of debt. 

Only get payday loans when there are no other options. Make sure to check out as many lenders as you can to compare their products. Some lenders can only offer payday loans and will push you to take it. 

3. Pawn Shop Loans 

Another quick way to borrow cash is by getting a pawn shop loan. This type of short-term loan is a secured loan. You provide collateral, whether it’s jewelry, musical instruments, or anything valuable, in exchange for the credit. 

Getting a small amount of money from the pawn shops is not tricky. There are no credit checks conducted for the loan. The crucial information they need is the value of the collateral that you are providing. 

As soon as your collateral is good, the lender can give you the minimum and maximum amount that you can borrow. Pawn Shops charge interest for the loan. In some cases, they also charge a processing and storage fee.

Repayment is usually after 30 to 90 days. If you cannot pay the full amount, you can pay for the interest and other fees to keep the lender from selling your collateral away. If you do not pay after a specific period of time, the lender has the right to liquidate your valuables. 

So, when should you get cash from pawn shops? Well, it should be one of your last options. If you don’t want to overpay or lose your valuables, it’s better to explore other loan options before deciding on a pawn shop loan. 

Selling your valuables may be a good solution. Of course, if it’s an item that you don’t want to lose, then you can choose a pawn shop loan. 

4. Signature Loans

Signature loans are short-term loans that bank on the borrower’s credibility and capability to repay it. It’s a type of unsecured loan. Aside from credit checks, you need to be recommended or vouched by your employer, friends, or organization members. 

Application for the Signature Loans is made online, through phone, or via visiting your lending company’s office. All you need to do is submit the necessary documents such as valid ID, pay stub or certificate of employment, utility bill, social security card or social security work card, and personal references. 

Lending companies require a credit check, but it’s not the main qualifier to get the loan approved. The main qualifier is that you do not have any outstanding debt from banks or other lending companies.

Additional payment, such as documentation, acquisition, and processing fees, are added to the full loan amount to be paid. Most often, the fees are fixed, so the amount is predictable and easy to manage. 

Repayment terms depend on the lending institution. On average, it’s between three to eight months. So, it’s more flexible to repay the loan within a restricted budget. You can know more about signature loans here

5. Auto Title Loans

Auto Title Loans are great financial opportunities to get the extra cash you need in a short period of time. It’s a short-term secured loan. As long as your vehicle is in good condition, you can set it as collateral. 

Compared to pawn shop loans, you don’t have to give up your car while it’s on collateral. You can still use it and continue with your daily routines, like going to work and school. Your productivity won’t be compromised at all. 

Applying for an auto title loan is easy. You can apply online or via phone. You can even meet with a financial advisor from the lending company of your choice. Submit requirements such as valid ID, utility bill, social security card or social security work card, and your vehicle’s clean title. 

All the documents you submit will be checked. Aside from that, the lending company will inspect and appraise your vehicle to determine the amount you can loan from them. You have better chances of getting your loan approved if your car is well-maintained and not older than ten years. 

The repayment of auto title loans is from three to eight months, which makes it easier to manage. You don’t have to worry about paying off the full loan amount (including the lending fees) immediately. Having this leeway period can help you earn more money from other jobs or until pay cuts are removed. 

Handling Money During A Pandemic

The pandemic has greatly affected the economy. Businesses and individuals are in survival mode. Many are stretching their paychecks to survive months as recession hits the U.S.

Asking for a little help from lending companies can help you tide over. It’s easier to get loans from them instead of banks. The application process is difficult and their qualifications focus on your credit scores only. 

Once you receive your extra cash, do not spend it all at once. What’s important is knowing how to prioritize spending to make sure money is not wasted. 

Re-evaluate your household’s expenses and create new budgets with food, water, and electricity as the topmost priority. Do not forget to save some money for emergencies, especially when it comes to your family’s health. 

Explore your employment options as well. Start learning new skills or looking out for possible employment or business opportunities. There are many home-based jobs that you can apply for, like tutoring, transcriptionist, SEO consultant, and virtual assistant. If you have a business, diversify and check if you can move to other channels such as online. 

For now, limit your unnecessary purchases, save money, and get the help you need through financial institutions like lending companies.

About Mohit Tater

Mohit is the co-founder and editor of Entrepreneurship Life, a place where entrepreneurs, start-ups, and business owners can find wide ranging information, advice, resources, and tools for starting, running, and growing their businesses.

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