To survive in this fast-paced world, sometimes, borrowing money is the only solution to meet your financial needs. While many don’t see it in a good light, borrowing money can help you in a lot of situations, including emergencies and managing your business cash flow. If not done right, borrowing money can be more complicated than it seems. This is because you need to find a trustworthy source to avoid incurring debt due to high interest rates. Even if you are financially stable right now, there’s a good chance that you might need to borrow some money in the future, even if it’s for investment purposes.
So, if you are looking for reliable and smart ways to borrow money, this article is all you need. To help you avoid financial pitfalls, we have compiled the most intelligent ways to borrow money. To learn in detail, check out this article till the end.
- Home Equity Loan / Home Equity Line of Credit
If you own a home, applying for an equity loan is one of the secure ways to borrow money. This loan allows you to get a loan on behalf of your share of equity, making your house collateral. Many businesses and homeowners are relying on home equity to manage their finances. Whether you go for a home equity loan or home equity lines of credit (HELOC) by Amerisave, it can also help with home repairs, emergency funds, tuition fees, investments, and debt consolidation.
Since your home is the collateral for an equity loan, the interest rate is relatively low, and you know exactly how much you owe in monthly payments, you can manage your finances with ease.
- Bank Loan
Despite the introduction of a variety of loan options, most people still rely on traditional bank loans as they have built their trust in them. The structured financing and fixed payment schedule make bank loans highly reliable. There are various types of loans that you can borrow from your bank, including personal, secured, and business loans. A personal loan requires no collateral and is best for managing your home expenses as well as debt consolidation.
A business loan is ideal for you if you want to expand your company, buy inventory, and maintain business stability. Bank loans also allow you to build a credit history if you make your payments on time. The process for applying for a bank loan might be longer than applying for other loan methods.
- Credit Card / 0% APR Credit Cards
Want some accessible cash? We recommend using your business credit card. Typically, the interest rate on your credit card is 21%, and it is a highly flexible way of getting a loan without long waiting processes. But if you don’t make the payments on time, you will have to pay high interest. For new purchases or balance transfers, a number of credit card companies provide promotional 0% APR periods.
Using these credit cards can be a wise choice if you require short-term financing, as long as you pay back the balance before the promotional period expires. If you follow the exact repayment plan, this method lets you borrow money without paying interest. Reward credit cards, standard credit cards, and secured credit cards are some of the other types of credit card options.