Cash Advance Loans and Students – A Dangerous Mix
Are you a college student wondering how online cash advance/payday loans fit into your finances? If you are a smart college student, then you will know online payday loans are only for emergencies. The payoff comes in just a few short weeks, so steady income is a must in order to pay it off without putting more damage into your finances.
Here are five tips for college students who are looking to get their finances off on the right foot.
1. Take your time getting new credit. For every creditor you apply with, there will be a mark left on your credit score. Hard inquiries to your credit done by potential creditors looking up your history will take a few points off your score for a year or two at a time. When your finances are just starting, this could bring you low really fast. Low credit scores will be denied. Too many creditors applying at once is also a warning sign for potential creditors that the applicant is desperate for cash. New creditors may take a different approach and offer incentives for the new debtor to spend more. A college student is an easy target for many marketing campaigns. Newcomers to finances are often attractive to reward programs which can trap the debtor into spending more than intended.
2. Don’t spend your credit on frivolous things then leave yourself no room for emergency costs. Emergency costs do not need to be funded by online cash advance loans when you have room on your credit card to lighten the load. When you use and manage your credit account wisely, they are a great source of third party money to help you get by and build your credit at the same time. Make your payments on time and keep the balance below 30% whenever possible.
3. If you are having trouble finding a creditor to approve you, you can fall back on being an authorized user on one of their accounts or have them be a co-signer to start you out on your own. The issue here is that your parents, or whomever you choose as your co-signer, will be responsible for any debt you accrue. They will also be privy to what you charge, when you charge it and where. This may not matter to some people but if you are one who may not be the best manager of money, it could be a sticky point in the relationship. If you are going to take this route, make it work for you so your credit will build into something helpful when you graduate.
4. Are you coming out of college and are finding your student loan debt to be financially draining? Don’t default on these loans. The federal government is not a creditor you want to have after your money. Before you miss a payment, look into finding a way to defer the starting date if you still have not gotten full-time work. Ask about reduced payments or changing your payment dates to better fit your pay cycle. If you have multiple loans, try to consolidate them for a lower monthly payment. Managing your money by making on time payments may best be done with automatic payments. Some people are not organized enough to make on time payments even when they have the cash in the bank.
5. Look into your options, which include deferring payments for a short amount of time, making reduced payments, or re-configuring your current payment schedule. Also consider consolidating multiple loans into one new loan. This often results in a lower monthly payment. Have the loan amount directly withdrawn from your bank account so you never pay late.
Cash advance loan lenders offer emergency cash for those times when there is no other place to turn. College students often do not have the income needed to support an approval. A responsible lender will not want loan to someone without a certain income. College students have it tough in the beginning but will have great financial success when managed correctly.