Perhaps you recognize it: the month lasts a little longer than you want it financially. Especially during the holidays, money flies out of your wallet. Of course, you are trying to save and keep in mind that you always have money on hand. What if it’s just a little problem? Then you can borrow a small amount of money. Even borrowing a small amount of money costs money. So be careful, as costs can vary widely.
Choice 1: fast credit
To start with the least desirable option: a small amount of online borrowing is directly related to flash / fast / urgent credit. Flash credit is a small loan that you take out quickly and need to repay quickly. In the past, this form of borrowing was outside the scope of the legislation, which meant that providers charged extremely high costs. That has now changed, but you are still paying too much for flash credit. For example, you pay extra for the quick transfer of the loan and if you pay off too late, you risk a high fine. Not to recommend!
Choice 2: be negative on your account
Being in the red is the (too) easy option in the list of possibilities to borrow a small amount of money. If you need a small amount in the short term, it may be worth spending a little more than your current account. If you receive your salary, it will be refunded to you in no time. But being in the red is an expensive form of borrowing money. You pay a high interest rate on the amount in red. Take into account interest rates of 11% to 14%!
Choice 3: credit card
Using your credit card is like using your credit card, as if you were in the red on your current account. When you make a purchase with your credit card, you postpone the payment for a period of time. In other words, you can also borrow money in one form or another. If you repay this loan within the set time, there is no problem. If you don’t, you will pay interest. Again, interest rates can reach 14%.
Choice 4: the unrestricted personal loan
The most advantageous way to borrow a small amount of money is to take out a personal loan or revolving credit. You will probably have to borrow more than you had in mind, as a personal loan or revolving credit can be taken out from $ 2,500. But you pay much less interest. You can take out such a loan from an interest rate of just 4.5%. You can simply repay the amount of your loan that you do not need.
Getting a full loan to borrow a small amount may seem very complicated, but it is certainly the least expensive method.
Also discover: borrowing money as an independent entrepreneur