Alternatives to Short-Term Loans Consider the possibilities before choosing a short-term loan: - When you need credit, shop carefully. Look for the credit offer with the lowest APR - consider a small loan from a credit union, an advance from your employer, or a loan from family or friends.
- Compare the APR and the finance charge of credit offers to get the lowest cost.
- Ask your creditors for more time to pay your bills. Find out what they will charge for that service.
- Make a realistic budget, and figure your monthly and daily expenditures. Avoid unnecessary purchases - even small daily items. Their costs add up. Also, build some savings - even small deposits can help - to avoid borrowing for emergencies, unexpected expenses or other items. This can give you a buffer against financial emergencies.
- If you need help working out a debt repayment plan with creditors or developing a budget, contact your local consumer credit counseling service. There are non-profit groups in every state that offer credit guidance to consumers. These services are available at little or no cost. Also, check with your employer, credit union or housing authority for no- or low-cost credit counseling programs.
- If you decide you must use a short-term loan, borrow only as much as you can afford to pay with your next paycheck and still have enough to make it to the next payday.
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