Tag Archives: high-interest loan

How to Pay Back a Loan

There are many people who wind up taking out loans at one point or another. Perhaps they needed the funds to invest in their education, pay bills, cover a sudden emergency, etc. However, regardless of the reason, the ultimate reality is that borrowed funds must be paid back.

Unfortunately, there are countless individuals who struggle with paying back loans which they took out. This ultimately doesn’t bode well, seeing as interest rates can be astronomical and quickly pile up with the passing of time. Therefore, people who are struggling with paying their back loans should adhere to the following steps.

Make Payments

Although this step sounds obscenely obvious, it’s one that many individuals fail to truly follow through on. So often, people get caught up in other financial demands, thus putting off loan payments. In even more unfortunate circumstances, some borrowers are unable to pay off their loans and simultaneously cover their everyday living expenses. Both scenarios almost always engender higher interest fees, and in some cases, total financial ruin.

According to OneMain Financial, some of the best ways to pay back loans are on a biweekly basis and via extra income. Extra income could be bonus/pay raises at work or even money which is gifted as a birthday or holiday present. No matter what, finding a way to put money towards borrowed funds is absolutely critical. Depending on the terms and conditions of the loan, certain lenders may be well within their rights to sue if their money isn’t returned to them within a certain time period.

Increase Revenue Streams

Individuals who find themselves struggling to pay the bills and also pay back their loans should look for ways to increase their income. Thankfully, this is relatively easy in 2018; the freelance market and gig economy are absolutely full of opportunities for people who know where to look. Sites like Fiverr and Upwork are free, thus allowing people to create profiles and market skills which potential clients are in need of. Some of the most popular and well-sold skills on the aforementioned platforms include writing, video editing, website design, etc.

Additional opportunities in the gig economy include driving for rideshare services such as Lyft and/or Uber or even renting out rooms on Airbnb. Each of the preceding options should be strongly pursued, especially if someone finds themselves struggling to comfortably pay back money they have borrowed from a financial institution.

A Final Word

While the process of paying back a loan may feel inconvenient at the same, the long-term benefits truly do pay off. Debt is like a proverbial cloud looming over one’s head. Getting rid of that cloud truly makes a difference and allows the borrower to not only avoid interest fees, but also put their money in savings, towards bills, or even towards investments.

 

Authored by Gabrielle Renee Seunagal

There Are Alternatives to a Costly Personal Loan for Canadians

Canadians don’t always have to turn to a costly personal loan to overcome financial hardship. There are options available to them.  These more affordable choices will protect credit and actually assist with building a better credit history. Before ever applying for any type of loan, the borrower should weigh the reasons as to why they need it. Depending upon the reason, or the need–there might be far better alternatives with lower interest rates available. Perhaps you need only a short-term loan that you’ll be ready to pay back in only 30 days? If that is the case you can often avoid those costly interest rates!

Also, if you have been turned down for a traditional bank or credit union loan, don’t worry and stress. There are millions of people who face this same dilemma. Credit requirements with traditional banking institutions can be far stricter, but this doesn’t mean to turn to a bad credit personal loan either. When you want to solve your debt problems, or you’re in need of emergency assistance you need to speak to a professional to get your finances on the right track. Canadians shouldn’t live in the shadow of a few late payments when they work hard and deserve better.

Let’s take the time to consider what an individual can do right now to avoid high cost personal loans and get life back on a positive track.

Go with a Financial Strategy that Works

Personal loan

Many payday loans and short-term loans make it look easy, but it isn’t always. One alternative to these is taking a loan out that helps you boost credit as long as you make your monthly payment on time! Also, what about those that offer money back on the loan because of good faith payments? These types of cash loans are available to consumers as well. It’s important for anyone taking out a loan or other financial support to use it as a financial tool that will help them to overcome an unanticipated expense. Any financial assistance should never be seen as free money. 

What financial strategy really works right for you as an individual or family? For many, finding a way to cover financial gaps is the main goal and they see no other way. Maybe they aren’t weighing their priorities? That is what we are striving to help with here. If you do move forward with taking out a personal loan, there are some common traps you want to avoid!

  • Don’t choose a personal loan that pre-computes interest because this creates a larger interest rate on a payment than what is actually necessary.
  • You can’t avoid the origination fee that comes with a personal loan, but you can save money by looking into the APR versus the interest rate. 
  • You can avoid the pre-payment penalty if you just ask if the loan company charges one.

We recommend doing your research before you go with a personal loan like this. If you’re smart and take your time a personal loan with a low interest rate and no origination fee can be helpful for the short-term; but you do need to be smart! Make certain you can pay off a loan such as this in a reasonable amount of time, otherwise higher interest rates can really beat up the finances.