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There are times in life where you will badly require expenses which are way past your current resources and worst of it all chances are that you do not have an emergency fund to help yourself out. Usually such times tend to come around at the middle of the month when you have used up a great deal of your money and you are looking forward to the next pay day. In times like these most people opt to take out their payday loans to cover the expenses, this loan is also known as cash advance. Payday loans are low-balance, short-term and are of high interest and are usually given at usury rates.
By nature the payday loan is easy and quick you can even request for payday loans online, however before you make the decision of taking out your payday loan, you need to put some few things into consideration. If you were looking forward to taking the payday loan soon, then this article is for you,we will take you through some of the things you should consider before taking a payday loan.
1. Start With Your Family.
Just as the saying goes ‘charity begins at home’ before you even start to consider taking a payday loan you should first request for a loan or funds from a family member or a close friend, this will help you avoid taking the payday loan when you do not necessarily need it. However the loan that you will request from a family member should be in writing and you should notarize the agreement so that the loan becomes legally binding.
2. Negotiating With Your Debtors.
The other thing you should consider before you take a payday loan is to contact the people or firms that you owe money to and try to negotiate a change in payment plans or a reduction of the rates or anything that will make the payment of the loan more payable. You might find out that the loan that you are owing is not worth taking a payday loan. Doing this can also buy more time to raise the money you needed for the emergency.
3. Have A Plan On How You Will Repay Your Loan.
The other thing you can do before taking the loan is to make sure that you first have the resources you need to repay back the loan. During an emergency it is very normal for someone to rush into taking a loan, however a payday loan is not just any other loan. Before you take a payday loan ensure that you have a source of income that will help you pay up or not make sure that you have something that can act as compensation for the loan. If you fail to have both and you still proceed to taking the loan then you might even end up being bankrupt.
4. Sell The Things You Do Not Need In Your Home.
The other thing you can do before getting a payday loan is selling some of the things in your house which you do not use, things you can live without or are just unnecessary at the moment. Just look around your home and search for things which you can sell for some quick cash. Be it an old video game or a bunch of DVDs which you do not watch. Even though it will not seem like a good idea at first, you will eventually be glad that you got the cash to tend to the emergency at hand.
5. Know Exactly How Much You Need.
The other thing you should consider is to make a budget of the exact amount you need and clearly know why you need it. A payday loan usually comes in handy during emergencies like paying for a medical bill or repairing a damaged vehicle since you need the car to get to work. You need to lay down how you are going to use the money once you get it so that you can avoid over spending. Doing this will not only make your work easier but also will make sure that no money is lost since when it is time to pay you will do it in full.
When it comes to the issue of payday loans caution must be taken, even before you apply for the payday loan the above points need to be taken into consideration so that you can have an easy time dealing with the loan, the points will also guide you so that you do not get yourself in a position where you need to take a payday loan. It is advisable that immediately you take the loan and sort your emergency, you should create an emergency fund and start saving so that you can avoid future inconveniences. You never know when an emergency might occur, the best thing to do is to be prepared in terms of finance.