Difficult economic times can mean unexpected expenses pop up such as a car breakdown or some other type of emergency which needs immediate cash. An instant personal loan may be a viable option depending on your circumstances and credit history. Personal loans can be an excellent source of quick cash but there are many shady financial organization which will use the borrower's dire situation to lure them into a bad loan with little legal recourse available should something go wrong.
Personal loans by their very nature are considered a form of unsecured credit in that they have no underlying collateral which can be used to pay off the loan should the borrower default. Personal, often called signature, loans have become less relevant in today's financial market due to the prevalent use of credit cards and other forms of financing such as payday loans and title loans. That does not mean that your local bank or credit union will not offer a personal loan only that it may be more difficult and should be a loan of last resort.
Since personal loans are unsecured against collateral the only basis by which a financial organization has to determine whether or not to issue a personal loan is by evaluating the borrower using credit history and their pre-existing relationship. Individuals with high credit scores and a long history of established revolving loan payments with accounts in good standing will be more likely to receive an instant personal loan from their bank or credit union. The problem is that the same organizations make little money and therefore have no real incentive to issue personal loans. It is more likely that these organizations would issue the borrower a credit card instead in the hopes that it becomes a revolving line of credit which will make more money in the long term.
Should you not have immediate access to a personal loan through your financial organization it may be best to look online for various micro-lending organizations. These types of Internet based companies can offer personal loans to qualified individuals often immediately when certain criteria are met. These criteria sometimes require continued employment, a certain income level and a valid checking account. Depending on the organization, these loans can be issued same day and for terms and interest rates comparable to that of credit cards with minimal penalties and fees. However, for as many reliable honest micro-lending organizations available on the Internet there are just as many if not more shady companies looking to scam borrowers. They try to have them enter into agreements under onerous terms with high interest rates and exorbitant penalties should they default.
Keep in mind that instant personal loans should only be used for major one-off expenses such as automobile repair, consolidating credit card debt and paying for medical emergencies. It is never wise to borrow more money than is immediately necessary because it can place the borrower in a tough financial situation should the payments be more than they can realistically pay under the terms agreed upon. Carefully read all paperwork provided by the lender to make sure you fully understand the terms to which you are legally responsible to follow to make sure you are protected and your rights are maintained. Predatory lenders try to use the borrower's desperation against them by taking what should be a fair and equitable process and manipulating it into one which places the borrower at significant financial disadvantage should anything go wrong with the loan.
If you can obtain the necessary financial resources from any other means such as family and friends, a workplace cash advance or by temporarily selling assets to a pawnbroker then you may be better off than seeking an instant personal loan. It's nice that this type of financial resource is available but be smart and do your homework before taking on any type of financial obligation for which you may not be fully prepared to fulfill.