Choosing Between Online Lenders VS Brick-and-Mortar Lenders

Both online and brick-and-mortar lenders have their benefits, but there are also many differences when applying for small dollar loans. So, going local or going online?

-Applying online is usually much faster than driving around your town and filling out physical paperwork over and over again. Online, you can start your application through multiple lenders at once.

-Brick-and-mortar options usually hand over cash while online lenders deposit loans into your checking account.

-Sometimes, brick-and-mortar lenders approve the borrower more quickly, though not always.

You can apply online 24/7 from home.

Can I Get Small Dollar Loans with Bad Credit?

In short, yes, you can get small loans if you have bad credit. The type of short term cash loans you can qualify for, though, will probably differ from those with good credit. For instance, people with good credit can usually get approved for unsecured loans pretty easily. Though there are unsecured loans for bad credit, you will more likely find yourself applying for secured loans or those with high interest rates. In fact, many with bad credit get stuck with options such as title loans and payday loans, which are not ideal.

On the upside, every lender and situation is different, so there is nothing set in stone. If you have bad credit and need small dollar loans, you simply need to look for them. You just might find a lender who offers you favorable terms.

Can Small Dollar Loans Help Improve My Credit?

Small cash loans can indeed help you improve your credit, but it depends on the type of loan you get. Again, loans such as title loans and payday loans do not get reported to the credit bureaus, so they will not help you build your credit. Some of those companies will, however, print out payment statements that you can send to the credit bureaus yourself. If you speak with a representative, they will likely add your statement to your credit.

Short terms loans, secured loans, unsecured loans, installment loans, and pretty much any other type of loan will regularly be reported. If you make your payments on time, these can increase your credit score. It will also show activity on your credit, which other lenders like to see. If you plan to purchase a house or car in the near future, having some favorable and fresh activity on your credit may help you get approved. Before making any firm decisions, though, consider speaking to a credit specialist to learn exactly how that might affect your buying power.

Make sure to understand that Cashry is NOT a lender. We only connect you with credible lenders.

Steps to Take After Getting Small Dollar Loans

When you get small dollar loans, after you have taken care of business, your number one goal needs to be to pay that loan off. To do so, there are just a few steps you need to take:

• Know the details: when is your payment due, what is the total of the loan, who do you contact if you have any issues, how should payment be made, and so on.
• Add your payment date to your calendar so that you do not forget it.
• Add the payment to your budget so that you can make your payment. If the loan payment is above your budget, now is the time to decide how you will make the extra money- not the day before it is due
• Follow through with your payment. This is very important because if you fail to repay the loan, it can negatively impact your credit. At times, you may even be taken to court for non-payment.

Avoiding Small Dollar Loans in the Future

The truth is that no matter if it is a small dollar loan, a payday loan, a title loan, a line of credit, a personal installment loan, or any other type of loan, a loan is debt. It is believed that some debt, such as a mortgage loan or one that will improve your credit, is “good debt”. Though there are benefits to those types of debts, I hesitate to call any debt “good”. Debt is debt, regardless of what it is for.

When and if at all possible, debt should be avoided. I am aware that, like my family, there are things your want or need to purchase that you simply cannot afford to pay upfront- such as a house or car. While you may not be able to avoid all loans, you can take steps to minimize the chance or needing to borrow money as well as the amount you have to borrow. The following steps can help you avoid at least some debt in the future, including small dollar loans.

Take an actual assessment of your financial situation.

If you hope to make any changes, you have to know what is going out and what is coming in, including small purchases such as using the vending machine at work. Sometimes it is the small purchases that add up to big problems if we do not pay attention.

Second, take out a calendar- digital or otherwise- and write your regular monthly bills and expenses on each month.

Then, add in the not so routine things, like oil changes, holidays, etc. I find that no matter how often we must pay for something, like an oil change, we tend not to add it into our budget. Suddenly, we are struggling to come up with the money for that oil change all because we overlook expenses such as these.

Here is the thing: holidays come every year, vehicle maintenance is required at fairly regular intervals, school starts back around the same time every year, and so on. How is it that we continue to be surprised by them? Write down every “uncommon” expense that comes with every month so you are no longer surprised.

Now, make a budget

Your budget should definitely include your monthly expenses, but let me share a secret: you do not have to wait until August to pay for back to school supplies and until November to start saving for Christmas. Instead, you can put a little up each month for each of these expenses. I know that everyone spends a different amount for Christmas, but let’s say you normally spend around $600 a year. That is a pretty large amount to come up with all at once. However, you could put $50 up each month throughout the year, have your full $600 cash for Christmas, and not go into debt to do it.

Calculate how much you need to put up monthly for each of these expenses and start saving for them each month by putting the cash in envelopes until you need it. Some banks will also allow you to sock money away into a Christmas fund that will automatically transfer into your regular account in November. Even PayPal lets you set up savings goals that can be separate from your regular account balance. Bottom line, stop going into debt over expenses that you know will come at some point in the year.

After you have determined what exactly you need to save and pay out each month, make sure that your income matches that.

If it does not, you have a couple of options. Either cut back on things that are not necessities or increase your income. Be sure that you have an emergency savings, as well, for things you do not expect.

Conclusion

When you need some help getting by, even if it is just for the weekend, small dollar loans can help. With varying amounts, interest, and terms, most people should be able to find one that fits their needs. As mentioned before, checking in with your local credit union is a great place to begin applying for small dollar loans, but you do have many other options.

You can choose to drive all over town and apply in person if you choose, but applying online is much simpler. It can save you a lot of time and a lot of energy. If you want to see what loans you might qualify for, check out the network of lenders that Loanry and Cashry can connect you with today so you can get on with other important things in your life.