You need money now, but you don’t have the enough amount. Borrowing money can be your choice. You can borrow money from banks and other financial institutions. But if you are in financial turmoil, better get private money to borrow because banks will not be willing to take high risks. Thus, borrowing private money is your only best choice.
Before anything else, try to borrow money from family and friends who have trust in you, willing to help you with your financial problem, and have the resources to help you. Most of them will let you borrow without interest or at least with low interest. If this option is impossible or you worry about the effects on the relationship, then better try other options enumerated below.
- P2P Lending Services. Are you familiar with online services that promote peer-to-peer lending? The goal of these services is to help people like you to find money to borrow. In these services, there are investors who deposit money for borrowing use.
In return, the investors get profit with the interest rate for the borrowed money. The interest depends on the service, the investor, and the borrower’s situation. People who have financial difficulty are usually charged with higher interest rate. But if you know how to negotiate for lower interest rate, then better do so. Explaining your capacity to pay the loan will be very helpful on this.
- Consider borrowing from specialized groups. What is the reason for your borrowing? If you need money for starting a business, then try borrowing money from private grants or groups supporting people who want to start their businesses. If you need money to support your education, then you can find nonprofit organizations or groups offering educational fund for students.
- Borrow from private lenders or investors. These people specialize on lending money for people who are in stiff need of getting money. Because they are lending for high-risk people, they usually offer high interest rate. But if you can prove you have the ability to pay the lender, then you can negotiate for better rates.
Before you apply for a loan, make sure to process all your papers first. Gather all the necessary documents that will prove your ability to pay the lender on time. You can download your recent credit report, have your social security card photocopied, get a copy of your last year’s taxes, and copy of your proof of income. You’ll need all these to comply with the requirements, anyway. Some lenders are able to obtain financial information about you but still, you need all these just in case they miss out important information about you.
Finding someone willing to let you borrow money is not yet the end of your struggle. But at least, with the money you have, you can already start a less financially stressful life.
Your next problem is how to pay the lender on time. Having late payments will reflect on your financial report and that will ruin your reputation as a borrower. The only solution is, of course, borrowing only the amount of money you can pay.