Need to borrow money during COVID-19? Here are your options
The global COVID-19 pandemic has brought us all to our knees. Business establishments are closing and the unemployment rate is rising rapidly, resulting in lost income. Everyone is doing their best to exhaust and exhaust all their financial resources, but hard times call for immediate help.
Ultimately, this is the time when we need to check all the available resources to keep us afloat. The main purpose of this article is to provide additional help and reference for borrowing money in the midst of the crisis. Plus, it includes a helpful suggestion on what kind of loan you should apply for to avoid additional financial burden.
It is essential to know that credit companies and banks always offer loans to potential borrowers. However, it is essential to check what type of loan you should apply for and what you should avoid.
Here are some types of loans available to you:
Personal loan: your best loan option
Banks and other lending institutions like CreditNinja are still offering personal loans during the COVID-19 crisis. However, it should be noted that before committing to a personal loan application, make sure you have an exceptional relationship with one of the institutions.
Note that banks have prioritized clients with whom they have a permanent relationship or with whom they have already managed their financing. They can always get new customers, but there are many factors to consider, unlike their existing customers.
Credit companies also offer personal loans, and taking out this type of loan during this crisis is the best option you have. They generally offer lower interest rates than other types of loans such as payday loans and cash advances.
Some online loan websites offer loan services with competitive interest rates, especially if you have a good credit rating.
Paycheque Protection Program: Help for Small Business Owners
If you are running a small business or have recently opened a new business and sadly in turmoil due to the crisis, you can turn to PPP or also known as Paycheck Protection Program. This is a type of loan program that can significantly help entrepreneurs keep their businesses afloat or at least finance their business enough to pay their employees.
The US Congress has reportedly allocated the program $ 600 billion and a repayment of $ 310 billion with a sign from the president. This is to help more businesses that were unable to register and get their share of the funds in the first version of PPP.
Experts recommend that the earlier you enroll in the program, the better the chances of getting the funds. This will give you more room to budget your finances while keeping your business afloat and employees paid.
Here are the other methods you can use for resource financing.
Stop paying your student loan or mortgage
Stopping paying off your student loan or mortgage plans is not an ideal suggestion you will get, but due to an unexpected situation brought on by the pandemic, this action is a good option for you.
Fortunately, due to the stimulus bill, all federally guaranteed loans are officially suspended for six interest-free amounts. You can put the money for repayment wisely as additional funds during the crisis.
If you are made redundant by your employer due to budget cuts, you must apply for this benefit immediately. The stimulus bill has extended its assistance to all unemployed people affected by the pandemic, allowing anyone who requested assistance $ 600 each week. And that’s in addition to the state-level benefits they’re eligible for at the same time.
We inevitably turn our heads to whatever is within our grasp, especially during times of desperation. However, if you go down this route, always proceed with caution as you might not like what you handle at worst.
Cash advance by credit card
If you have a credit card, getting a cash advance is your quick fix. But remember, just like payday loans, credit card cash advances also come with a high interest rate. If you have to use your credit card, make sure you spend it on your daily needs, as maxing out your card could lead to a bad credit score.
To take with
In these desperate times, this could lead to many individual resorting to extreme measures when it comes to borrowing money. But be careful before you make a decision first and check all your resources to see if there are any methods you can use that may be of use to you. With or without a pandemic, you should be responsible for borrowing money. Any drastic decision or decision will put you in a financial burden that you don’t want.