Borrowing is often a part of adult life. Almost everyone needs to opt for a loan at some point. Maybe it’s for buying a new home, college tuition, or perhaps starting a business.
Although borrowing is not an unusual thing to do as an adult, it can be easy and convenient or difficult and expensive.
Whatever the reason, there are plenty of ways today to borrow money that there weren’t in the past - whether it be from banks, credit unions, people you know well or through friends who are financially secure themselves.
Below we have listed some of the best ways to borrow money easily and what to avoid while borrowing money.
Cheapest ways to borrow money
Borrowing can help you get the things you need when you need them most. The right type of loan - especially when it comes to getting approved quickly and having the money disbursed to your account fast - can also save you money on interest rate costs, as well as time wasted pursuing other lenders. If you qualify for a credit score of 690 or more, these are the best options available to borrowers like yourself:
- A personal loan from a credit union or bank
The banks or credit unions typically offer the lowest interest rates, or total cost of borrowing, for business or personal loans. Loan amounts range from a $100 to $50,000 or more.
- 0% APR Credit Card
A 0% APR credit card is often used to consolidate existing credit cards balances and can be useful for consumers with multiple outstanding purchases who want to avoid Credit Card Debt.
0% APR loan duration usually ranges from 6 - to 18 months, and while your first year may have no interest rates, it’s important that you continue to make timely payments since the regular APR will apply once the introductory period ends.
- Buy Now Pay Later
By Now Pay Later, also known as BNPL, is a popular financing option which allows you to purchase a product or avail a service without having to worry about paying for it immediately!
Best of all, you can repay your borrowed amount at any time of your choice as there are no pre-set deadlines.
2. Fastest ways to borrow money
There are ways through which you can get loans easily and quickly. Let’s have a look at a few of them.
- A personal loan from an online lender
Compared to traditional lenders like banks, who often require completing numerous paperwork in person at a branch, online lenders have set up an application and funding process that’s completely online — which can speed things up.
- Loan apps
If your need isn’t substantial, cash advance apps provide small advances on your paycheck, sometimes instantly. Loan disbursing times are between one to three days.
- Cash advance from a credit card
You can also get cash advances through your credit card. Think of it as ‘buying’ cash. You’ll get the money immediately, but this option is not to be taken for granted as you’ll have to pay interest on it. The interest on your cash advance from a credit card can add up very quickly and turn into a major expense.
Borrowing options to avoid
There are a few types of loans that you should avoid at any cost. Try to keep the last option if you are desperately looking for a loan.
- Payday loans
The total annual cost of the loan is 391% APR, and the term you’ll have to pay it off again is 38 days. In other words, taking out a payday loan would just be pointless since you’d be paying for your debt for twice the amount you borrowed!
- High-interest installment loans
High-interest installment loans are repaid over a few weeks to months and have an interest rate of above 36%.
Wrapping up
So, if you are looking forward to a loan, make sure that you choose the best or the quickest loans but avoid payday and high-interest loans at any cost.
