3 Easy Ways To Make Money During The Coronavirus Pandemic
Between skyrocketing unemployment rates and stalled reopening of businesses as the number of new cases rises, many Americans are in need of financial help during the coronavirus pandemic. With that in mind, below are three ways to quickly access the funds you need to stay afloat. Read on below to get an idea of which method might work best for you.
Take out a personal loan
If you need cash quickly, take out a Personal loan can be a solid option. On the one hand, the good personal loan can give you access to up to $ 100,000 in just a few working days. On the other hand, personal loans generally offer lower interest rates than credit cards, according to May 2020 data from the Federal Reserve, while the average interest rate on a credit card is 14.5%, on a personal loan it is only 9.5%.
Since the interest rate granted to you on a personal loan is determined mainly by your income and credit rating, the best thing you can do to get a low rate is to shop around. You can use an online site like Credible to compare your loan options.
You can also use their personal loan calculator to get an idea of what you can expect to pay on a monthly basis based on going rates.
Get a 0% APR credit card
Alternatively, if you think you will be able to pay off the money you spend in a short period of time, it may be worth considering getting a zero percent rate credit card. These cards provide the ability to spend on the card without accumulating interest charges on new purchases for a set period of time, typically between 18 and 24 months.
If you think that get a credit card might be the right choice for you, you can also use an online marketplace like Credible to compare multiple APR card options at zero percent in the comfort of your own home.
That said, if you are looking for funds to pay off existing debt, a balance transfer card will likely be a better choice. Balance transfer cards allow you to combine multiple debts into one monthly payment and typically offer a lower introductory interest rate, which can reduce the amount you pay in interest charges overall.
However, one thing we don’t recommend doing is using a credit card for a cash advance. Usually, the limits for cash advances are low, but they come with high fees. In most cases, you are better off finding another source of funds.
Leverage your home equity
If you own your own home, there’s a good chance you can access additional funds by tapping into the equity you’ve built up in your home by making mortgage payments. Here you have two options. If you need a fixed amount for a big purchase, your best bet will probably be to get a home equity loan. However, if you prefer to have access to a pool of funds that you can draw down as needed, you might be better off getting a Home equity line of credit (HELOC).
Home equity loans work like any other installment loan. With these loans, you receive a lump sum of money. Then, since these loans have fixed interest rates, you will have a fixed monthly payment to be made until the loan is fully paid off.
Alternatively, a home equity line of credit works more like a credit card. With a HELOC, you can borrow against the equity in your home for a set period of time, pay it off, and start over as needed. Like a credit card, your monthly payment will also vary depending on the amount you’ve borrowed. Since HELOCs generally have variable interest rates, the amount of interest charges you can expect to pay may also vary.
Notably, some HELOCs will offer an interest-only period, which allows you to only pay interest on the funds you’ve spent while you can borrow against the line of credit. Once your borrowing period is over, your minimum monthly payment will also change to reflect the principal amount of what you have borrowed.