Getting a personal loan is a solution for many home renters. This is because tenants need to have sufficient cash to cover expenses such as the security deposit and the cost of transferring from one house to another.
Emergency loans also allow tenants to make rental payments on time. Thus saving them from paying late fees while keeping their records of payment clean. Unfortunately, renters who have been served their eviction notice normally have bad credit. As such, these tenants turn to government-sponsored housing programs aimed at preventing eviction.
For many cash-strapped renters, taking a loan to fund moving costs such as rental for trucks and self-storage is the solution. But those enrolled in a medical residency program can seek assistance from specialized relocation lenders who provide cash loans based on positive future earning potential.
Let’s get into the details and answer some of those renter-specific questions.
Emergency Rental Loans
Security Deposit
Renters take out an emergency personal loan for a variety of reasons. For one, the loan allows them to pay for the security deposit or their monthly rent on time. Naturally, any tenant would like to pay their rental fees promptly to save them from paying late fees and from being evicted.
Plus, emergency personal loans are also accessible. You can simply go online to look for institutions offering loans. There are websites dedicated to connecting people to possible lenders such as Loanstart.
However, you may want to think twice before getting a personal loan to fund the security deposit or the rental fees. Keep in mind that being caught in a financial crisis can cloud your judgment, and the loans you take out during this time can turn out to be disastrous in the future.
Moving to a new rented place can be quite costly. And in many cases, the security deposit is the biggest expense when moving into a new spot. The landlords or property managers ask for the security deposit to fund the repairs of any damage to the rented property beyond the usual wear and tear. The deposit is also used as a hedge against the default on rental fees when the lease term is about to end. It makes sense, but it can be a huge financial burden on the renter. That’s where the loans come in to help.
Make sure you only borrow the money needed for the security deposit and moving costs if you are paying for the transfer to your new home using the funds sourced through emergency loans. Be prepared to have the documents and requirements on hand before applying for an emergency loan. These requirements would normally include a valid ID, bank statements, proof of employment or source of income and contact information.
Aside from the security deposit, you can also use get an emergency loan designed for rental assistance that will allow you to pay rental fees on time. However, you must consider both the advantages and disadvantages of borrowing money to pay off your rent. Again, getting yourself into debt can cause you more financial troubles in the future.
Rental Assistance
You must compare the cost of paying a late fee and borrowing money. The advantage of paying on time is that it allows renters to avoid having to pay late fees, among others. Check your lease contract to know how much the late fees are, then compare to the interest rate of the emergency rental assistance loan. If getting an emergency loan is cheaper then go for it. If not, then paying a late fee to your landlord might be a better option.
Bad Credit
Bad credit records can affect your loan applications. Be prepared for more work in getting an emergency loan if your credit score is low. You might want to reach out to lenders who do not require credit checks or proof of capacity to pay. Additionally, you may want to provide some advance payments to convince your potential landlord to lease the property to you despite your credit rating scores.
Eviction Prevention
If you’re on the verge of being evicted, then you may want to consider getting some legal assistance to help you ask the court to give you more time to leave your current residence. There are also non-profit and religious entities that help those who are to become homeless. They can provide you with financial assistance.
Consider Moving and Relocation Expenses
You also have to consider other expenses like the truck rental and storage cost on top of the security deposits and rental fees.
You shouldn’t underestimate the prices of renting a truck or trailer for your big move. Your pockets or bank accounts will also feel the burden of renting self-storage space if you have excess items you can’t bring to your new address. Borrowing money can cover for these expenses if you’re running low on cash already.
If you’re in medical school or a recent graduate of medical school, then you may want to consider specialty lenders who are willing to loan the amount you need. Specialty lenders, after all, look at your future income potential.
Again, bad credit can affect your ability to get a loan for your moving expenses. Often, people with a bad credit history may find themselves paying higher interests and shorter loan terms. As such, you may want to ask help from friends or family to help you in transferring to your new home.
*Note: Rentable is NOT offering financial advice. Please consult a financial expert before making any financial decisions based on the contents in this article.
