In this live from paycheck to paycheck kind of world many people fall behind on bills from time to time. Or, emergencies crop up and waylay even the most carefully planned budgets. When money problems arise, one of the best ways to handle a minor situation is to seek out cash advance services and borrow funds to make ends meet.
Cash advances are not like using credit, in fact, in many cases it can be better to get an advance rather than charge up a card. Of course, credit cards will work to bail people out of minor situations, but the use of these can add up and create more problems for their owners in the long run. When possible, cash advances are desirable for the following reasons:
* They rely on money that will be coming in for the payment. By “borrowing” from the next paycheck or another future source of money, the “loan” gets paid off right away.
* Fees are generally lower than interest. Since most cash advance services charge a flat fee rather than an interest charge over time, the loan is paid off on the next pay cycle and there’s no worries about interest compounding and building up. This is where those who use credit can get themselves in trouble. A few hundred dollars in interest charges that’s allowed to remain stagnant, for example, can turn into thousands of dollars of debt over time. A reasonable flat fee is taken care of right away.
* Simplicity. Most cash advance services don’t even require users to have credit or credit cards to take advantage of their programs. All that’s generally required is a steady job, proof of paycheck amount, a checking account and some form of photo identification. This means even someone with bad credit or no credit can still have the cash in hand to tackle a minor emergency or make a bill payment before it’s late.
* Convenience. Cash advance companies are open in most major cities 24 hours a day, seven days a week. Some even offer their services online anytime, any where.
Using credit over a cash advance service for bills or emergency expenses that can be covered with a paycheck in a week or two comes with the following disadvantages:
* Unless the card is paid off at the end of the month, interest can accrue. This means even a $100 charge can become a charge that’s worth much more to the credit card company.
* Keeps credit free for major purchases and/or emergencies. Why charge up a few dollars when it’s just not necessary? Debt management counselors will say credit should only be used for the “big things,” when there’s no other means for handling an emergency. Even then, it’s not always a good idea to do so.
Sometimes only a credit card will do, but if the money will be available through a paycheck in a day or two, why incur interest? There’s really no reason to when cash advance services are convenient, affordable and always open. It’s a simple fact of life that bad things can happen that waylay budgets and make it difficult for hard-working people to make ends meet.
Eliminate Debt
For many bankruptcy is a four-letter word. And it should be. This option should be the absolute last considered when it comes to debt elimination. Although it can wipe debt clean and give a person or a business a clean slate from with which to work, the impacts of bankruptcy are harsh and sometimes can be avoided. Before leaping, it’s a good idea to truly examine a situation and look at other avenues of redress.
If debts have gotten out of hand and a solution seems hard to find, there are some things a person can do before charging into bankruptcy. They include:
* Assess all debts versus income. Is there a way to handle the debt without filing for legal redress? If income outweighs monthly payments, bankruptcy might not be the answer. Careful handling of cash assets and payments might be the smarter route. Setting a budget and sticking with it would be in order.
* Contact creditors and try to negotiate lower interest rates. If you’ve made your payments on time all the time, this might be an option for helping you avoid bankruptcy and get out of debt quicker. This doesn’t always work, but some credit companies will be more than happy to work with a good client.
* Create a debt management plan. If it’s possible, pay off credit cards one at a time. Take a look at the smallest balance card and set a date for paying it off. Once this is done, dedicate the money that would normally go on that card to another one. Rinse and repeat until debt is erased.
* Don’t add more debt while you’re paying old debt down. Live within your means, reserving credit for emergencies only. This can be hard to do, but if a future without debt is desired, this practice will greatly help you in attaining that goal.
* Seek help from credit management companies. If you know you can pay off the debt without seeking bankruptcy, but you can’t come up with a viable plan on your own, seek help. There are nonprofit companies dedicated to helping consumers get out of holes they’ve dug for themselves. These companies look at all the debt a person has, work with creditors and negotiate settlements. Although it’s true credit involved in the settlements will be unusable during the repayment periods, the bottom line presented by these settlements can be much lower and more manageable than the debt prior to the agreement. This methodical process for paying off debt has worked for thousands and thousands. Just make sure you’re dealing with a reputable company.
If debt and monthly payments outweigh income, bankruptcy might be the only alternative. If it is, you’re not alone. Thousands of individuals and companies file for bankruptcy every year. Bad things happen to good people; it’s a fact of life. Just remember as you’re going through the process to hire good legal representation, follow the laws and be certain not to dig yourself back into the same hole when the process is over.
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