If temporary financial setbacks have put you in a position of need, a small loan - or cash advance - should be considered a viable borrowing solution, particularly for those who have insufficient credit scores. Small loans are good alternatives to traditional personal loans and credit cards, but they must be used wisely in order to be effective. Here are five small loan tips to give you the most of your situation.
1. Only Borrow What You Need
Most small loans can offer you up to $1,500, but if you only need $400, then apply for that amount only. Getting more money than you need may lead to misusing your loan funds or paying more in interest than you really need to, so only borrowing what you need will save you money in the long-run
2. Apply Early in the Day
Many lenders have limits each day to how many loans they can give out. When you apply early in the day, you give yourself the best chance of getting approved for a loan. If you apply early on a weekday, you also have the best chance of receiving your money as quickly as possible, often within hours.
3. Have a Good Relationship with Your Lender
When you take out a loan, don't be a stranger to your lender. You always want to have a good relationship with them. If your loan goes well, then you'll have a lender that trusts you if the need for money ever arises again. And if you start to fall behind on your loan, you'll be able to communicate with your lender, tell them what's going on and they will often work with you to create a flexible repayment schedule. Either way, it's in your best interest to know your lender personally.
4. Repay Your Loan As Soon as Possible
If you have the money, consider repaying your loan as soon as possible. When you cut it too close to your loan deadline, you take the chance of a weekend, holiday or other obstacle stopping you from paying your bill. If the bank is closed on a holiday, for example, you may have to wait until the next day to pay your loan, which could result in late fees. Instead, pay early and avoid possible repayment issues.
5. Only Take Out One Loan at a Time
Avoid the temptation to take out multiple small loans. When you have one loan out, this is manageable and you can easily repay the loan within the allotted amount of time. But when you throw additional loans into the mix, you are only increasing your chances of ending up in small loan debt. So take it easy with one loan at a time.
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