How to Use Bad Credit Instant Cash Loans

Instant cash loans, which are also called payday loans or cash advances, should only be used in emergencies.

Many people rely on bad credit instant cash loans because they are quick and easy to get. One reason why many people turn to such loans is that you don’t need to go through a credit check to get one. Another reason why many people get such loans is that they don’t require a lot of paperwork to fill out.

Don't take unnecessary instant cash loans

Bad credit instant cash loans are still a very bad deal for most people despite the ease with which you can get them. These loans are a bad deal because of the very high interest rates the lenders charge on them. One popular payday loan company charges 231% interest on its most popular loan product.

How bad credit instant cash loans work

The way an instant cash loan works is simple, a person borrows $100 but agrees to pay back the $100 in a set period of time a week along with a $15 fee. This translates to a 15% interest rate on money which is comparable to the rate charged by credit card companies. This means that the instant loan isn’t a bad deal if you pay it off fairly quickly.

The problem is that instant cash lenders charge the fee on their money every week. If you borrow $100 at the 15% rate and pay the loan back in two weeks you’ll be paying back $130. If you pay the loan back in three weeks you’ll be paying $145 and if you pay it back in a month you’ll be paying $160.

This means that you should always pay a bad credit instant cash loan back as quickly as you can. Even if you have to borrow money from another lender such as credit card cash advance to do so.

Look for other sources of funding

Before turning to an instant cash lender you should look into other sources of funding. You might check and see if you can borrow money from friends or relatives before taking out such a loans.

Another option that many people ignore is pawnshops. If you have items like jewelry, electronics, vehicles or firearms that you don’t use regularly in your home you can pawn them. The pawnshop will usually give you a better rate than an instant cash lender.

Another advantage to the pawnshop is that you will have more time to pay the loan off. If you can’t pay the loan off, you can simply leave the item at the pawnshop and your credit record won’t be affected.

Selling off items that you don’t use is another means of raising money that you can look into. If you have any items made of precious metals in your home such as gold jewelry or silverware you should look into selling them. The price of gold and silver is high right now and many pawnshops and jewelers are paying high prices for gold and silver.

A bad credit instant cash loan is something that you should apply for only when you have no choice. Always check out all other options before applying for such a loan.