Emergencies can happen that affect your personal finances in temporary ways, and this unforeseen expense can create a shortage of money during the month. When you take care of an emergency expense, you will likely take funds from another area of your budget. This will likely make you short of cash for a monthly bill. This problem can be solved with a payday loan, and you will save money at the same time. There are three situations in which a short-term loan will do this.
Avoid a late fee on your rent or mortgage
If you will be short of money in paying your mortgage, you will incur a late fee. The chances are that a short-term loan will cost less than a late fee on your mortgage, so you will save money. The same will hold true on paying your rent; however, in the case of a mortgage payment, a late payment will also affect your credit rating.
Avoid a late fee on a car loan
A late fee on your car loan will likely be high enough to justify getting a short-term loan. It may be tempting to call your lender and let them know you will be late. In some cases, they may let you make two payments the following month. But this type of strategy will cost you a late fee and additional interest. A smarter choice is to get short-term loan. You will likely save money, and your credit will be unaffected.
Prevent your car insurance from lapsing
This is huge. If the one bill you come up short on is your car insurance payment, you can easily have your policy cancelled. Many insurance companies now report cancelled auto insurance policies to the Department of Motor Vehicles. Upon receiving this information, they can cancel your vehicle registration. This will result in a fine that must be paid in order to have the registration reinstated. This fine is usually several times greater than the flat fee charged for a payday loan. Of course, if you get caught driving without insurance, you will face additional fines and penalties.
Always remember to first look at the amount of money it will cost you by not paying a bill on time, and then look at how much the loan will cost you. If this is less than the late fees and other charges you incur for not paying on time, then a payday loan will likely be a smart choice for your personal finances. For more information, contact a local payday loan company like #1 Cash Stop.