In today’s world, we need money to get along in life. Sometimes, life situations arise, and we need more than we have in our savings accounts, which means that we must borrow the funds. When it comes to borrowing money from a traditional financial institution, credit ratings are considered. If yours is on the low side, then taking out a loan could be a problem. The good news is that there are other types of loans out there. However, these loans can be costly, so it’s important to only take them out when you have no other option. Here are 10 dire life situations that could be made better with a loan. LoanReviewHQ.com can help you choose the best loan for you.
An Excessive Car Repair
Cars are one of life’s necessities. It’s likely that you need one to get to and from your job. You might even use yours to take your kids to school and run everyday tasks. The average cost of a car repair is from $500 to $600. Many people don’t have that big of a cushion in their budgets. If you don’t, then you might need a loan to cover it. A loan will help you continue working and taking care of your typical responsibilities.
Medical Emergency
The healthcare system in the United States is broken when it comes to how much we pay. This means that when many of us experience a medical emergency, we don’t have the money to cover it. Currently, the average cost of a hospital stay is more than $10,000. Most people don’t have that much saved up. A loan will allow you to pay the bill in increments, making it more affordable and something that you can add to your monthly budget.
Utility Bills
Some months, utility bills are more than you can cover. This type of bill is a dire life situation that a loan may be able to fix. While the utility companies may give you a month or two to catch up, it can be tough to do. Instead of reaching that moment when the electric company turns off your power, consider taking out a short-term loan. These are often approved more quickly than loans from traditional institutions.
House Payment
If you’re facing a financial shortage and won’t be able to make your house payment, then it may be better to take out a loan to cover it. That way, you would be able to avoid the late fees that mortgage lenders charge. These can be quite high because they’re usually based on a percentage. So, for instance, if your lender charges a five percent fee and your monthly interest and principal is $1,700, then your late fee would be $85. A loan will not only help you avoid the late fee, but it will also help you preserve your credit rating.
Bail a Loved One Out of Jail
If your spouse, a sibling or a child should wind up in jail, then it’s likely that you’ll want to bail them out. This is one of those dire moments when you may need a loan, and you’ll need one fast. In this case, a short-term loan may be the best way to go. With one, you’ll likely get the money you need right away to bail the person you love out of jail.
Down Payment on a Car
Purchasing a car is one of those times when you need to have a little extra money on hand for the down payment. If you don’t have this money saved up, then a loan can help. A down payment decreases your monthly car payment. It may also help in the approval process. Sometimes, people wind up in situations in which they just can’t wait to buy a car. Maybe, your current vehicle is no longer running, or you were in accident and your car was totaled. If you found a really good deal on a car, then it may be a wise financial decision to take out a loan for the down payment and buy it now.
Funeral Attendance
If a loved one dies in another part of the country, you may not have the funds to attend. Funerals are important since they are a life event that can only happen once. When a funeral takes place, you’ll want to be there to honor the person who died as well as for the survivors. The problem with attending a funeral may be the expense since flying to a faraway destination at the last moment is usually pretty pricey. Because of this, you may need to take out a loan to be there.
House Repair
When your home requires major repairs, you may not have the funds to cover it. In many cases, home repairs are not something that you can put off, which means that if you don’t have a comfortable savings account, you may need a loan. Hot water heaters, furnaces and air conditioning units tend to last for anywhere from 15 to 20 years, so when they fail, the cost to replace or repair them can be expensive. You may need a loan to cover the cost.
College Tuition
When your kids reach college age, you’re suddenly facing a big expense. If you didn’t save enough for them to go to school, a loan could seriously help you manage the costs. Along with the basic cost of tuition, college requires expensive textbooks, general supplies and maybe even living expenses. Research shows that the average cost for school from 2017 to 2018 was almost $21,000 for a public in-state school and an estimated $50,000 for a nonprofit private college.
Moving
In life, change must happen, and sometimes, it means that we have to move unexpectedly. It may happen so quickly that you don’t have time to save up to make the move. In this case, you will need a loan to get to your new home. Whether you’re moving for a great new job or because you just need a change of scenery, a loan can help.
When to Get a Loan
Dire situations in life can be helped with a loan. If you’re considering taking one out, make sure that borrowing money will help you instead of making your financial situation more complicated.