“I need a personal loan quick but I have bad credit.” An old friend of mine was calling for advice. “What’s the best way to get my hands on money? Should I go to one of those places that offers instant cash, or a check advance?”
My response: “That is your fastest two paths to Bankruptcy.”
If you are like many cash-strapped Americans whose scores fall below 720, you should–of course–learn how to build credit. But what do you do in the meantime?
You might think you must rely on high-interest loans with large penalties and lousy terms. But sadly, too many people desperate for money end up exacerbating the situation by applying for loans intended for people with bad credit, which guarantees that they will pay extra fines and interest rates. The irony, of course, is that people with bad credit are the ones who are least able to afford these loans.
If you find yourself saying, I need a personal loan quick but I have bad credit, consider one of two options:
1. If you have a long and strong relationship with your boss, ask for an advance.
This is an interest-free way to secure some quick cash, and your boss might let you pay the loan off slowly by simply taking small deductions out of each paycheck.
Only implement this strategy if:
• You have been at your job for more than one year,
• You have a strong relationship with your boss, and
• The company has a solid bottom line.
You should also pay close attention to the amount of the loan. To protect your relationship with your boss, follow this general rule:
If you have been employed for more than one year but less than two years, ask for no more than 2 percent of your annual salary. Your boss might feel comfortable lending you 5 percent if you have been with the company for two to three years; if you have been working for the same company for more than three years, you might be able to secure a 10 percent cash advance.
2. Another low-interest option is to ask a relative for a loan.
Be upfront about your situation, but be businesslike. Instead of calling in a panic and saying, “I need a personal loan quick but I have bad credit,” try writing out an agreement that details interest, when the payments will be made, and what you will provide as collateral in the event you are late with a payment.
By putting everything in writing, and making every payment on time and in full, you will preserve your relationship and secure a low-interest loan.
MIDDLETON LAW OFFICE, PLLC helps people recover from the mistake of getting fast cash loans at predatory rates. We also assist our clients with rebuilding their credit scores after Bankruptcy by providing our clients with the services of www.720creditscore.com.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.
POST OFFICE BOX 3129
2604 WEST MAIN STREET, SUITE C
TUPELO, MS 38803-3129
TELEPHONE: (662) 205-4749