Yes, it is possible to get an emergency loan with bad credit. However, many lenders may try to take advantage of your situation when they learn that you need emergency cash immediately. They might charge you high interest rates, add on excessive fees, or implement additional costs that will damage your credit score even more.
Not all emergency loans are created equal. However, we’ll explain what to look for when you search for an emergency loan, what to avoid, and how to get emergency money safely.
Where can I get an emergency loan?
There are several ways you can get an emergency loan. Some are safer and easier on your finances than others. Take a look at the options!
Credit Builder Loan
MoneyLion offers a Credit Builder Loan designed to help people with poor to no credit access affordable financing. It’s one of the best alternatives for an emergency loan because of its unique benefits and perks. As a member, you’ll be able to access credit monitoring tools, competitive rates, and same-day cash, all without agreeing to a hard credit check.
Most credit builder loans won’t give you your funds upfront. However, MoneyLion’s membership works differently. You’ll have access to some of your funds right away, and the rest will be held in an interest-earning account under your name.
MoneyLion is proven to help build credit. Over half of users were able to boost their scores by 27 points within 60 days.
Payday Loans
When you need emergency money now, many people resort to payday loans. Payday loans can get you emergency cash immediately, but they come at a high cost. Most payday loan terms require them to be repaid when you get your next paycheck. But because of APRs that can be as high as 400%, many people struggle to pay back everything in full by the due date.
If this happens, you’ll be charged extra fees that put you at risk for rolling over payments, falling into a debt cycle, ruining your credit, and ultimately losing tons of money. Payday loans are one of the most predatory lending options around, which is why, in many states, they are illegal.
If you do decide to work with a payday lender, proceed with caution. Read the fine print and make sure to pay back everything you owe on or before the due date.
Title loan
Title loans are collateral loans. They require you to put up an asset you own—such as your car or house—in exchange for financing. If you are unable to make your payments on the loan, you’ll end up losing your car, house, or whichever asset you’ve put up as collateral. For these reasons, title loans can be very dangerous to the point where they are even illegal in some states.
Personal Loan
A personal loan gives you a lump-sum of cash you can use to finance a major purchase or to consolidate debt. Personal loans are usually granted by banks, feature competitive interest rates, and are paid off with regular installments.
Unfortunately, personal loans are not an emergency loan and they won’t be the best choice if you need emergency money now. That’s because personal loans come with strict qualifications, and a good credit score is almost always a requirement. Plus, the application process is incredibly long, taking anywhere from a couple of weeks to multiple months before you hear back.
Cash advance
MoneyLion offers a 0% APR cash advance that can help you access emergency cash immediately. It’s called Instacash, and it’s a premier emergency loan in terms of safety as well as affordability. You can borrow up to $250 at 0% without a credit check. There’s no monthly fee and you can get your funds deposited into your RoarMoney account at any time.
Non-loan options
Aside from emergency loans, there are other non-loan options you can take advantage of in order to get emergency money. Here are some common examples!
Credit card
You can use your credit card to get emergency cash immediately. However, be wary of high-interest rates and racking up a balance that you can’t afford to pay off in full. If you do decide to use a credit card, make sure you have the ability to unlock a low-interest rate or 0% APR promotional period.
Payment plans
If you’re faced with a large medical bill, know that you’ll usually be able to work with the medical establishment’s billing department to negotiate an affordable payment plan. The IRS, municipal governments, and credit card companies are just some of many institutions that will accept payment plans.
Borrow from a trusted family member or friend
If possible, seek out a trusted family member or a friend for a loan. Just make sure you’ll be able to pay back the money you borrow. Otherwise, you’ll risk damaging the relationship.
Adjust student loan repayment plan
If you’re behind on bills or other loans, call your lenders and discuss the possibility of forbearance, deference, or an income-driven repayment plan.
Make sure you explain your financial situation honestly and sincerely. Get them to understand that you will continue to struggle to make timely payments unless you receive some relief. Keep in mind that in some cases, interest may continue to accrue even if they grant you relief.
Financial hardship grants
Seek out charities or religious organizations in your area that offer free meals, financial assistance, or other emergency financial hardship grants. Some governments and local municipalities may also offer financial aid or other forms of assistance.
Families should seek out their state’s Office of Family Assistance, which provides cash, child care, and job training to low-income families.
Ask for an advance
Instead of an emergency loan, head over to your employer and ask for an advance on your paycheck. Make sure to explain your situation and offer to pick up extra hours if needed.
Some federal employees might be eligible for a no-interest hardship loan or other financial assistance support through the Federal Employee Education and Assistance Fund.
How to get emergency money safely
MoneyLion offers a host of financial programs to help you be in control when it comes to your finances. You can get a much-needed emergency loan through a Credit Builder Plus membership or by using Instacash. Other banking perks are made accessible to you as well.
For only $1/month, a RoarMoney account will offer you unique features, including up to two days of early paycheck deposits, budgeting tools, debit card cashback, and price protection. Get the financial help you need with MoneyLion.
