If you are in need of a $5000 loan with bad credit, and you need the money fast, then your options are going to be limited. In this post we will discuss a few of these options, helping you to understand what you need to qualify for such loans….and what you need to watch out for so you don’t end up spending way to much money on the interest/fees of the loan.
Option 1 – Cash advance from a credit card
Again, if you need the money fast then this is one way to get it. While interest rates on credit cards are very high relative to traditional bank loans, this option is actually one of the cheaper options for people who need the cash fast and who have bad credit. However, you do need to have the credit card already (if you have poor credit you may not qualify for the card, and it will take a week or two to get it anyways), and you need to have $5K of availability. Use this option if you need to borrow the money for anytime less than one year.
Option 2 – Title Loan
This options works, but comes with a few different stipulations that you need to be aware of. First of all, don’t use this option for funding longer than 30 days. This is a short-term loan only, which is determined by the cost of the financing – average rates are over 200% APR. In addition, remember that you are pledging your car, which means if you default on the loan they will reposses your car to cover the loan.
Option 3 – Payday Loans
This is your most expensive option for a $5000 personal loan that you can get. As such, be extra careful to make sure you can pay off the loan within one month (average costs are above 400% APR, with some reaching as high as 700%). You can get these loans with bad credit, and you don’t have to put up any collateral for the loan.
Bottom Line – be careful with this type of financing. You don’t want to get stuck with a ton of debt just to get you out of a short-term jam. In other words, don’t take a short-term financial problem and turn it into a long-term one.