If one thing is certain about the COVID-19 pandemic, it’s that the economy has struggled and people are in a dire financial situation. People are out of work. They are struggling to pay their bills and keep moving forward. Are you one of the many people around the world who is struggling to pay their bills? Luckily you have options.
Below are five types of loans and credit sources that can help you get through the pandemic as well as their pros and cons.
Installment Loans
One form of borrowing that you may not be aware of is online installment loans. These internet loans are easy and quick to get. You won’t have to go through the whole rigmarole of applying for credit cards or another large lender. While the loan eligible may vary depending on where you are in the country, if you get approved you can pay the money back in small, frequent payments. With long-term repayment options, you can give the money back in multiple installments. This online lending method has proven very popular for its ease and simplicity.
Health Care Credit
One type of credit that you might not know about is health care credit. There are a variety of lenders who focus on medicine and health care. When you are trying to pay for dental services, surgery, medication, or simply a physical, credit from a company that lends for health care is a great option. Be careful to pay back what you owe immediately or the company might sell your debt to a credit consolidator who may charge you an even higher interest rate. The pandemic has made us all focus more on our health, if you need to pay for some health care there are some options to finance it.
Personal Loans
If you have decent credit and need a loan, a personal loan can be a good way to obtain cash. There are two different types of personal loans, fixed-rate and variable rate. A fixed-rate loan has an interest that doesn’t change because it is determined by the market and a variable loan is based on your credit score and financial stability. When you need a loan, do some research on the best option for your particular situation and you will be able to get the money you need.
Secured Credit
When you have a low credit score and can’t obtain a credit card, you can try to get secured credit instead. Secured credit cards can help you raise your credit because they have a limit depending on the amount that you have deposited. Not only does it provide a way for you to allocate money, but it will also help you implement better financial discipline. However you look at it, secured credit is good for those who can’t obtain traditional credit.
Short-term Loans
Otherwise known as payday loans, short-term loans are a quick option for anyone who has bad credit and needs quick cash. While the interest rates for these loans are obscenely high, they can provide money for those who need it quickly. Of course, you should pay these loans back as soon as possible—if you don’t you will have to pay a lot of extra money. These should be the last resort, but they are an option when you are in a bind.
The pandemic has created all kinds of financial, personal, and emotional suffering for people. If you are struggling to pay your bills, these various forms of loans and credit can help. While they all have their benefits and drawbacks, it is good to have options. Consider your personal situation before you take out one of these loans or apply for credit, you will be glad you did.
It’s important not to take the first loan you can get. When you take a look at what you need and how you will be able to pay the money back, it will provide a great way to look at your life in a critical way. None of these types of borrowing are solutions to long-term financial problems, they can help you in the short run by providing the money you need.
