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When you're faced with an urgent financial situation, you may feel desperation, stress, and potentially hopelessness. But 24-hour loans can put you back on the straight and narrow, provided you learn how to use them responsibly.
Key Takeaways
Otherwise known as same-day loans or emergency loans, 24-hour loans let you receive funds on the same day you apply for the loan. They offer rapid access to cash for urgent situations and unexpected expenses like medical bills, home repairs, vehicle repairs, and more.
To provide such fast funding, lenders underwrite, approve, and disburse the money all in one day — something unseen anywhere else in the finance world.
A 24-hour loan works like you'd expect it to: you apply for it, gain approval, and receive the funds in one day. Like other financial vehicles, they may come with various fees and costs, but these vary drastically from lender to lender and the type of same-day loan you acquire.
Lenders of 24-hour loans don't have stringent requirements, helping them keep the approval speed to a minimum. You don't even need to have a good credit score; providers use other tactics to minimize the risks of lending to bad credit borrowers. Depending on the type of loan, you must provide bank account information, personal identification, and collateral.
Once you receive the funds, you can use them for almost anything. However, borrowers tend to cover the following scenarios with same-day loan money:
As alluded to earlier, there are various types of 24-hour loans. Here are five of the most popular:
Payday loans are probably the same-day loan that springs to mind when you initially hear the phrase. They're the most commonly used, thanks to their incredibly easy application process.
They're short-term loans allowing you to borrow a small sum (around $500 or less) and repay it when you receive your next paycheck. While they're offered in brick-and-mortar stores, most modern borrowers prefer taking out online payday loans for even swifter approval.
Pawnshop loans allow you to offer something valuable as collateral for the loan, such as heirlooms, electronics, or jewelry. You'll get a fraction of the item's value in cash, and the pawnshop keeps your item until you repay the amount.
Associated fees depend on your location and can vary fairly drastically from state to state. You can figure out what you should expect to pay by heading to the National Pawnbrokers Association website.
If you can't pay a bill with your credit card, you can take a cash advance from it for quick access to money. Once you're approved, you can withdraw the cash at a credit union, bank, or ATM.
While this seems like a no-brainer type of 24-hour loan, there is a unique drawback — you normally have to stomach an upfront fee. Typically, it's 5% of the advance amount, with a $10 minimum charge.
Credit card cash advances also begin accruing interest straight away. You don't benefit from the grace period provided by credit card balances.
Title loans require your vehicle as collateral. The provider keeps your car's title and allows you to borrow the requested sum, which is usually a fraction of your vehicle's fair market value. Unbeknownst to popular belief, you can keep driving your car while repaying the loan; the lender simply holds on to your title document.
You don't need to meet any stringent credit requirements, allowing the money to be disbursed as quickly as possible. However, you may be subject to processing charges and financing fees.
While typical bank-offered personal loans take a while to process, personal installment loans from online lenders, like Simple Fast Loans, are quick and easy to get your hands on. With an immediate decision, you can access between $200 and $3,000 (depending on your state) in as little as 24 hours, helping you rapidly recover from sticky financial situations.
Unlike title loans, you don't need to provide any collateral to secure the loan. Instead, you just need an active checking account, proof of identification, a social security number, and income statements.
The various same-day loan types explained above come with different pros and cons. However, the entire category shares some positives and negatives, as described below.
24-hour loans bring these advantages for people in unforeseen emergencies:
No matter what you decide to do, always do your research before selecting a lender. Read third-party review sites and review customer testimonials to make sure your needs align.
Same-day loans have clear usages, but they aren't always the best option for you. In some situations, you may want to seek an alternative, like one of the following:
Depending on your reason for seeking a loan, you may be able to receive assistance from a charity or nonprofit organization. Many entities offer money, educational workshops, mentorships, and job training for those in need.
Financial help from these organizations is essentially grants that you do not need to pay back. However, the competition for the funding is fierce. You have to prove you qualify for the money, which can take a while.
Your employer may allow you to have a paycheck advance, letting you access all or a portion of your next paycheck before your payday. Generally speaking, your borrowing limit will be capped at $1,000, but that tends to be enough for minor emergencies.
Since you're borrowing against the money you've already earned, keep in mind that you'll have less coming in on your payday. Not to mention that you need to repay the advance.
PALs are offered by federal credit unions. They're usually capped at $2,00 and are repaid over a few weeks or months, depending on the specific union's terms. They're unsecured, aiming to provide you with a lower-cost alternative to payday loans.
If you have a good credit score, you may be able to get a 0% APR credit card. Such cards feature an introductory period (around 15 months) where you don't pay any interest.
If you have equity in your house, you could take out a home equity line of credit that lets you use the money you've already paid as collateral to secure the loan balance.
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