Cash Required? Check out your options for quick cash here

- by Kelly Richards

Need cash quick? Explore your options with this simple yet detailed guide to the different sources of short term money available, analysing the pros and cons of each choice.

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Cash Solutions

Payday is not coming, yet—at least not in the next couple of weeks. The wad of cash in your wallet has thinned. This may sound embarrassing, but you are already contemplating how you will shoulder the expenses for the next few days.

It is tempting during a time like this to borrow cash using the most common methods. Before you jump into doing so, however, you should be weighing the pros and cons of each option. Here are several ways for you to access extra cash when you find yourself needing a lifeline, divided into bank and non-bank categories:

Bank overdrafts

This is an example of a common method of borrowing that you can obtain from a bank. An overdraft is a facility added to your account wherein you allowed an amount overdrawn and will be charged a regular fee for the use.

Pros

Cons

  • Fast and convenient to obtain
  • Readily available cash flow backup when approved
  • You are charged interest only when you use it; you pay nothing when you do not
  • Poor payment performance can cause your bank to close down your overdraft facility
  • Not a viable long-term solution because of the high cost of interest, often surpassing that of loans
  • Secured with a business asset, which you can lose in case of repayment mishaps

Non-bank cash solutions

Self-explanatory, but some non-bank solution examples are credit unions, payday loans, cash for gold and pawnbroking. You can check the descriptions of each below.

Credit unions

There are about 500 credit unions in the United Kingdom. Of course, you need to be a member with savings of one or two before you can take out a loan. Although this type of community organization is not-for-profit and exists to encourage people to save, it is also a good source of loans because of its non-capitalist orientation.

cash from credit union - Cashfloat

Pros

Cons

  • APR has a monthly cap of 3% or yearly 43.6%
  • Easy access to loans from the collective money of the union
  • No late/early repayment fees or hidden costs
  • Free insurance
  • Length or repayment can go up to 5 years for unsecured and 10-25 years for secured credit
  • Maximum 2 credit unions to join
  • Building up savings first before borrowing

Cash loans

Cash loans are also among the easily accessible means of getting money. If you need to get money fast you can apply here for a cash loan from Cashfloat. Just fulfil the requirements and you are on your way to getting approved.

Pros

Cons

  • Fast and convenient loan sign-up
  • No asset used as a collateral
  • Less questions asked
  • Sky-high rates: Interest rates used to shoot up to as much as 1000%, but now the Financial Conduct Authority has put a cap of 100% of the original sum
  • Vague terms: There may be terms that may prove to be detrimental to the borrower but beneficial to the lender
  • Not a dependable solution for the long haul

Cash for gold

So you have been keeping gold jewellery in a trinket. And now that you are in an emergency, you think of sending it by mail to the online companies that promise to exchange cash for your gold. If it is an heirloom piece or an accessory with sentimental value, it should merit thinking and re-thinking on your part.

Cashfloat - cash for gold

Research on the cash for gold firms as there are reviews about them on the Internet. You should look closely at the gold market’s price. Observe how a particular company appraises gold. Compare and contrast. Know the advantages and disadvantages.

Pros

Cons

  • No trip to the pawn shop
  • Quick and easy because of the mail-order method
  • Undervalued gold, e.g. a ₤200 in the gold market may be valued by a cash for gold firm at ₤75
  • Presence of a middleman will deplete the sum of money you will end up having
  • Insurance needed for the gold piece you will mail to the company

Pawnbroking

Over time, pawn shops have been viewed less and less a place to avoid if you are an honest transacting individual. It is, in fact, a thriving segment.

Pros

Cons

  • Another fast and convenient way to get money
  • Face-to-face interaction vs the online cash for gold method
  • Lower appraisal for an item which you can sell online for a higher retail price

Other things to think about

Now that you know the advantages and disadvantages of each option, it is up to you to analyse which one you can use. But the more important thing to think about is: Do you really need to borrow via any of these means? Do you not, by any chance, have savings or an emergency fund you can use? The second thing is: Will you be able to pay back the money you will owe?

For the second consideration, you will have to make a short list of your salary and outgoings. Write the important ones first, such as mortgage (if you have one) or rent payment, utilities such as gas and electricity, council tax, food, travel, and education. Entertainment allowance can be forgone at the moment. Also think of other items you can do away with as you make a budget plan.

Get the sum and proceed to comparing the balance with the cost of borrowing money using these common methods. Each option differs in its resulting figure. It is necessary for you to tabulate each result if you are considering any of the options. That way, you will be able to see which can provide you with the best deal.

It can still be tricky even after you have weighed the pros and cons. But what matters most, is that you make a well-informed decision before acting on your desire to get cash from an outside source during a time of need.

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About The Author
Kelly Richards
Kelly is the founder of the Cashfloat blog and has been working tirelessly to produce interesting and informative articles for UK consumers since the blog's creation. Kelly's passion is travelling.
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* Cashfloat terms and conditions apply. Applicants must be 18 or over. All loans are subject to affordability, applicant verification and traditional credit checks via various national databases by Cashfloat responsible lending policy. In most cases, loan decisions may take up to 30 minutes during office working hours. If your bank does not support Faster Payments, funds will be sent to your account the same day as approval so long as you’re approved by 16:30.


*Money will be funded to your bank within 1 hour of approval - Mon-Fri during working hours.


Representative example: Borrow £700 for 6 months. 1st monthly repayment of £168.45, 4 monthly repayments of £224.60, last monthly repayment of £112.20. Total repayment £1,179.05. Interest rate p.a. (fixed) 185.39%. Representative APR 611.74% Our APR includes all applicable fees. Daily interest is capped at 0.798%.


Warning: Late repayment can cause you serious money problems. For help, go to moneyhelper.org.uk