“I need money and fast”. This is one of the phrases that are repeated more today as a result of the increase in mortgages and the credit crisis. There are different formulas to reach this objective from the sale of assets until the so-called easy credits. Each person and family will choose which best suits your needs and especially to their economic situation. However, there are more advantageous than other options from a more objective point of view.
CNN Money has drawn up a list with 16 formulas get that fast loan and it has ranked them from best to worst. Some are too focused on the U.S. market and have had to be adapted to the Spanish case. The first options are the most profitable from a financial point of view, whereas the latter can be dire and the starting point for the creation of an insurmountable debt. Thus, the solutions are as follows:
- Go to your Emergency Fund, it is precisely for that. The worst thing is that after using it already there will be no economic mattress for any vicissitudes.
- Sell part of your non-retirement investments. Ideally, undo positions of assets that have not been offering good performance. That Yes, we must take into account that will have to pay to finance their fair share for the benefits.
- Ask your parents for a gift. This possibility is not within the reach of everyone (by age and resources). Anyway should be the first on the list from an exclusively financial, although perhaps not from a moral point of view most closely related to the pride.
- Liquidate the deposits of low profitability means almost always lose part or all of the interests but it is also one of the quickest ways of getting money.
- Liquidate life insurance policy is an option which will mean the loss of much of the interests but which will not increase your debt. In addition, it is not available in all types of life insurance.
- Selling the equities portfolio is an option that does not include the article but that should be done before going in search of funding employed.
- Borrow money to family and friends is a similar alternative to the go to parents for help. The difference is that in this case Yes would have to return the money. Most advisable is to write a loan contract between individuals that clearly establishes the conditions of payment and return. From a financial point of view it would be one of the best options, above liquidate life insurance policy.
- Expand / refinance mortgage loan capital tends to be one of the most commonly used options. The problem is that not everyone can be requested and now banks are not conceding too many loans of this style. This is why many tend to opt for agencies and companies who could provide them with a similar service. In the U.S. case, it raises the possibility of ‘recover’ the money that has already been paid House, something uncommon in Spain. The advantage over a personal loan is that interest rates are lower.
- Taking money from the pension plan. Some pension plans allows you to ‘remove’ some money with the condition of reintegrating it within a limited time period, even though they are the least.
- Loans between individuals are relatively widespread in the United States but that is just beginning to emerge in Spain. The advantages are that the interest rate is even lower that a personal bank loan.
- Applying for a personal loan is an option that does not reflect the CNN Money article, but we should never lose sight of.
- Sign a reverse mortgage only available for persons over age 65 who moreover do not have access to some of the options related to their pension plans.
- Sell part of the heritage. At this point not only is already of material goods that are not used but it can also include car, antiques, and jewelry.
- Squeezing credit card (cards) is one of the worst choices for very contradictory as it may seem. Although United States interests of credit cards are higher than in Spain, here also is still a bad choice in the short and long term, that Yes, something better than since 15th that Americans give it.
- Liquidate all pension plans is by far one of the worst choices.
- Go to a lender should be the last alternative. In this sense it should be very careful about the conditions of the loan to avoid falling into total ruin.
Logically the latest proposals must be avoided at all costs and reserved for moments of real need. As general strategy is necessary to reach a balance between rid of all available assets and the credit application because to minor older heritage will be difficulties to get funding in optimum conditions.