Emergency Cash

Sometimes life throws you a curve with illness, an emergency, or other unexpected expenses.  Let’s say your heat pump breaks down and you need to come up with some cash to fix it.  Unless you have a rich uncle that you can borrow from, your next step will be to head to your local financial institution and apply for a loan.  Most people have no idea of what type of loan to apply for, how long it will take, and which option would best fit their needs.  It can be so confusing and a bit daunting to ask for money.  Here are a few ideas of where to start.

There are many different types of loans to choose from.  Your choices could include a Home Equity loan, a Vehicle (equity) loan, a Personal loan, a Personal Line of Credit, a Credit card, or even a secured savings loan.  Some of these loans use equity.  Equity is the difference between what your collateral is worth and the balance owed after fees.  This is cash that you can put in your pocket. Because loans are based on many different factors to qualify such as your credit score, income, job time, and personal debt, the choice may be easier than you think. 

Home Equity:  If you own your home, there may be equity between what you owe and what it is worth.  This loan takes a bit longer to process so would not be a good choice for getting funds quickly.  Typically there are more fees involved, but a higher amount of funds may be available.

Vehicle loan:  If you have a vehicle, boat, RV, or many other types of collateral, chances are there might be equity available.  Let’s say you own the vehicle outright.  You may have quite a bit of funds available to use if you qualify.  You can take out a low interest loan using the vehicle as collateral.  Depending on what it is worth, those funds could be available to get back in cash.  Even if you have a loan on a vehicle, there may be equity available between what its current value is and what can be refinanced.  This loan has a set term and interest rate.

Personal loan:  This loan is one that is unsecured, which means there is no collateral used.  It is based on your ability and history to re-pay.  The interest rate is typically a bit higher than a secured loan, but a good choice if you don’t own any collateral.  It has a fixed interest rate and term.

Personal Line of Credit or a VisaThese loans are also unsecured but are loans you can keep using over and over.  You have a set amount that you can draw on, up to that limit.  A personal line of credit has no cards attached to it whereas the Visa is a credit card that you can use to make purchases.  Both are good to use if you would like to have credit available for future needs.

Secured Visa, Savings, and/or CD loan:  If you have funds in a savings or a Certificate of Deposit but don’t want to use them for the emergency, you can borrow against them.  You are using your own money, but replacing the funds by making your payments every month. 

These types of loans are just examples of where you might find funds available for your needs.  A member service representative at your local Rogue branch will be able to tell you more about which of these would be the best fit for you and your unique situation.