Sometimes, there are unpredictable expenditures that pop up out of nowhere.
They could be car repairs that require a lot of money or hospital bills that you never saw coming and turned out to be more severe than you predicted. It could be home repairs that you can’t put off due to its importance.
Whatever the reasons may be, all these unexpected expenditures are always expensive and may require you to take an emergency loan.
Taking an emergency loan comes into play when you don’t have cash stashed away for rainy days, or your savings are not enough to cover your expenses.
However, this is understandable because some paychecks are barely enough to get by on; the next question that requires an answer is where to get the emergency loan from.
Most people struggle with this question sometimes and are confused about your options; luckily for you, credit unions are prepared to offer you an emergency loan to take care of your needs.
The question, however, becomes if a credit union is the best solution for your emergency loan. Credit unions are member-oriented.
They are nonprofits and therefore offer lesser interest percentages and charges to members. Their loan options are vast, and you could borrow up to a thousand dollars.
The payment of the borrowed funds can be stretched out over months and paid back in installments.
The interest on borrowed funds is also considerably lower than you would get any other place; a loan with a credit union will help you save funds and stress.
With credit unions, you can get your emergency loan in the form of a credit card loan or a personal loan.
Below are some factors to be considered when deciding whether to go for an emergency loan with a credit union or not; let’s take a look:
Better Interest Percentage
The best interest percentages can be found with credit unions, and the law usually covers them.
The highest that is predicted to be the highest interest charge is about 12%, usually far lower than this.
Most credit unions have an interest percentage far lesser than 10% and are much more affordable than banks are.
If you’re looking to get an emergency loan with your credit cards, then the limit is usually smaller because credit cards are only designed to cover few purchases conveniently. It doesn’t require you to collect a new loan for little expenses.
However, a credit card union offers a much high lending limit for members who have a good credit score and a higher annual income, which shows that you can easily pay.
The limits are usually over fifty thousand dollars and more and will conveniently help you take care of those unexpected expenditures.
Your repayment options with a credit union are far more flexible than you can find with any other lender.
You can choose to pay back the load before time or change your repayment options if it turns out you cannot meet up with the repayment structure you initially signed up for.
Credit unions do not have penalties for this because they recognize that financial situations are unpredictable.
Therefore, they are willing to support you in changing your repayment mode to fit your present condition.
A Personalized Loaning Method
If you’re looking for a personalized method to get your emergency loan, a credit union would be your best bet.
Banks are generally not so interested in your condition and will be cold when analyzing whether loaning you the money would be the right step for the bank.
However, credit unions are quite different and will hear you out. They also try their very best to make sure you get the loan you require and pay with your present condition in mind.
Banks cannot meet the customer experience you get with a credit union; they’re more human when considering your loan and are not all about the figures.
If you’re looking for an emergency loan, you don’t have time to spare to be moving from one building to another, looking for your best options.
Many credit unions provide you with an easy way to discover your options on their website; you can quickly get an estimate of your credit cost and interest percentage on their platform.
Also, there is mostly an option to request for the loan on the platform, and they will contact you immediately to explain the process to you.
You don’t even have to stress yourself or leave the comfort of your home.
Another reason to consider a credit union for your emergency loan is that it is transparent; there are no hidden costs that will come back to bite you in the future.
Administration charges are not added to your loan, and whatever you agree to is going to be your final cost till you decide to change the terms for the borrowed funds.
The terms are usually honest, and they are happy to explain in simple terms for you any part of the document you don’t quite understand.
If you’re looking for a lender that’s all about ethics, credit unions are your safest options.
Therefore, they are nonprofits and do not exploit people because of their situation or because you need their assistance.
That is why they only lend out to their member; they will grant you the loan if they genuinely find that you can pay back the loan.
They won’t lead you into taking a loan that would only cause you more stress in the future.
That is why credit union officers consider your credit history and income to ensure that they offer you the best loan and repayment option to fit your situation.
Emergency loans could be for anything, and at the end of the day, you always have to pay it back.
Whatever your reason for taking an emergency loan, it is best to consider options that offer you the best rates and are quite convenient for you.
Emergency loans are put in place to help you take care of unpredictable expenses, but it is imperative to consider your options and pick the right institution to get the loan from.
If you think credit union is worth the shot, then go for it.