Everyone gets into a cash flow crunch sometime. If it happens to you, know where to go to raise money in a hurry.
Child actor Gary Coleman may have made the payday loan famous, but that doesn't mean it's your best option for fast cash-even if you do have bad credit.
When cash is impossibly tight, you might be tempted to get an advance on your paycheck from a payday loan company. But try to resist. The annual APR on a 14-day loan can be in excess of 400 percent! You may have other options, even when your credit report has 'lending risk' written all over it.
Six fast-cash alternatives
* Credit card cash advance. According to a 2007 credit card study by Consumer Action News, the average cash advance rate on a consumer credit card is about 22 percent. It's not ideal, but in comparison to a payday loan, it's a bargain. If you don't have the available credit, you can always call your card issuer and ask for an increase. The answer will depend on the quality of your payment history, so bad credit candidates may not qualify.
* Float with your grace period. To avoid paying a high cash advance rate, pay some of the larger bills on your credit card-this frees up your cash for other purposes. Utilities, groceries, and gas can all be easily paid for with plastic. If you pay these off when you receive the bill, you'll have benefited from an interest-free loan.
* Ask a relative for some help. Here's an opportunity to create a win/win situation for you and someone you love. Ask for a short-term loan that you'll pay back with interest. You get the cash you need, and your relative makes a few bucks on the deal.
* Check county government offices for emergency assistance programs. In Los Angeles County, the Beyond Shelter Rental Assistance Department coordinates many programs to help households that are in danger of becoming homeless. It's worth a little research to find out if your community has something similar.
* Ask your boss for a payday loan. Check with your employer to see if you can receive your paycheck a few days early. Some employers may provide you with an interest-free advance, but get ready to pay interest if that's what it takes.
* Apply for a short-term loan with your bank or credit union. Your banking institution may offer instant-approval, short-term cash loans. Sometimes, the only requirement is that you're enrolled in a direct deposit program. The bank then takes the money you borrowed right out of your next deposited paycheck. Again, the rate might be high, but not in comparison to a payday loan.
Diff'rent strokes for you
Since these options don't require formal loan approvals, your bad credit history shouldn't get in the way. And that's something Gary Coleman and his payday loan provider don't want you to know.
