Should I Take Out a Same Day Loan for an Emergency?

Emergencies can strike at any time regardless of preparation, and in a moment’s notice you could find yourself strapped for cash. Whether your car is suddenly in need of a costly repair or Mother Nature decided you needed a new roof, a same day loan can get you the money you need immediately.

While this may seem like a perfect solution, there are important things to consider in the short and long term before applying for a same day loan.

Pros of Taking Out a Same Day Loan

Get cash fast. Same day loans are just that – loans that, when approved, are available usually within a few hours (if process and approved before 5 p.m.). This obvious advantage of same day loans offers cash you need to help with whatever emergency situation you’re facing right then and there.

Avoid missing payments and suffering credit blows. Missing payments for whatever reason will result in a ding to your credit, potentially harming your ability to make future purchases down the line when you get your finances back in order.

Avoid further accumulation of debt. Some borrowers choose a same day loan to dig themselves out of a hole of credit card or other debt and prevent more fees from accumulating. Consolidating your debt through a same day loan can help you avoid credit hits and will give you some extra breathing room to get your finances together and make repayments that are more in line with your budget.

Cons of Taking Out a Same Day Loan

There are different types of same day lenders and the differences between these lenders are important to your financial health.  You will see terms such as Payday Loans, Title Loans, or Installment loans.  They may all get you cash same day, but the structure and fees of these loans are very different and worth understanding.  

What is the difference between those different loan types?  Paydays loans are very short term loans some times for a few days or a few weeks that come due when you get your next paycheck.  These are for small amounts with very high-interest rates.  These loans are hard to get out of because they often auto-renew and pile interest on top of interest. These companies have a bad reputation for a reason.  Citizens Financial does NOT engage in any Payday lending.

Title lending is similar to payday lending.  The title loan company does not check your credit but rather holds the title to your car.  In the event that you don’t repay the loan, the car will be repossessed.  It is common for all loans to require collateral such as an auto, but title loans can have very high rates and fees similar to payday loans.  Citizens Financial does NOT engage in any title lending.

Installment loans with a fixed monthly payment at a fixed interest rate that is paid each month until the loan is repaid in full.  This is the most transparent and straightforward type of loan and it can be used for most any type of need.  This is the core personal loan we offer at Citizens Financial.

Still Not Sure? Ask Us.

Same day loans offer a great solution in times of stress and uncertainty, but don’t let your immediate financial concerns cause you to make a rash decision that could negatively impact you in the long term. Having a strong credit history will open a lot of doors, especially in times of need.  Talk to a friendly finance professional at Citizens Finance to see how we can help.