Do you need extra funds to cover an unexpected or emergency expense? A $500 loan can provide quick relief and make an urgent purchase more manageable. Knowing how to get a reasonable short-term loan quickly can come in handy. Discover how you can get a $500 loan whenever you need extra cash.
A $500 loan can go a long way. It can help with sudden car repairs, last minute gifts, or higher-then-expected utility bills and various surprise expenses. Consumers have several choices if they can get an additional $500 in their pocket. Personal loans, lines of credit, cash advances, title loans and payday loans are some of your choices, but some are better than others. Searching for competitive loans can help you save on fees and interest, but it all starts with knowing the steps to obtain a short-term loan.
10 steps for obtaining a $500 loan
Getting a $500 loan can make unexpected expenses more manageable and give you time to pursue a side hustle or wait for the next paycheck. If you need the extra cash now, these steps can help you get a loan faster.
1. Determine which type of loan to get
When it comes to obtaining a $500 loan, there are several options available. Some may make more sense than others depending on your specific needs and financial situation.
If you have a credit card, you may be able to get a cash advance for $500. Keep in mind that cash advances usually come with high interest rates and fees, so it’s essential to understand the terms and consider the costs involved.
Credit builder loans
A cash advance for a 500 loan is a short-term loan that allows you to borrow up to $500 in cash without having to go through the traditional loan application process. It’s typically used for emergency expenses or to cover unexpected costs. Cash advances are usually due on your next payday or within two weeks of taking out the loan. These loans can come with higher interest rates compared to traditional financing, so make sure to understand the terms and conditions thoroughly.
Payday loans are short-term loans that typically need to be repaid on your next payday. They are quick to obtain but often come with high-interest rates and fees. You’ll want to be careful about payday loans since people have been known to fall into a cycle of debt after borrowing them.
There are online lenders that specialize in providing small-dollar loans, including $500 loans. These lenders may have more flexible eligibility requirements and faster approval processes than traditional banks. Nevertheless, you may find only a small number of lenders willing to approve a $500 loan.
2. Look into your credit score
Before applying for any loan, it is important to know your credit score. FICO scores range from 300 to 850, with a higher score being more beneficial. A credit score of 700 or higher is considered good, while anything below 600 may make it difficult to get approved for a loan.
Approval isn’t the only perk of a high credit score. Lenders give consumers with good credit scores lower interest rates than consumers with bad credit scores. You can access more financing at better terms if you work on your score. Even if you do not plan on taking out a $500 loan soon, you should strive to improve your credit score.
Take a look at Credit Score Monitoring with MoneyLion.
3. Research lenders
Some lenders offer reasonable rates and don’t charge as many fees, but other lenders can present excessive interest rates. Before working with a lender, it is a good idea to look at their online reviews. Websites like Trustpilot make it easy to view what past customers think about the lender. You can narrow your search to reputable lenders who offer small personal loans and use a site like Trustpilot for guidance. You can also ask for recommendations from friends and family. Make sure you compare rates and terms before deciding on a lender.
4. Gather necessary documents
Banks, credit unions and online lenders may request several documents before giving you financing. You will have to provide proof of income, ID and other personal information. Consumers can review the lender’s checklist of necessary documents to see what they need, but most banks have the same requirements. Assembling these documents and knowing where they are in advance can streamline the application process.
5. Consider alternative options
If you have a low credit score, getting a loan from a traditional lender may be more difficult. Even if you get a loan, you could face a higher interest rate and less favorable terms. Viable alternatives exist, such as peer-to-peer lending, cash advances and borrowing from a friend or family member.
Did you know you can get a cash advance up to $500 with no interest through MoneyLion InstacashSM1?
6. Apply for the loan
Once you have chosen a lender and gathered all the necessary documents, it is time to apply for the loan. The application could include questions about your income, credit history and other details. Fill out the application completely and accurately.
Most banks or lenders have a quick application process that only takes a few minutes – especially for online loans. These short applications make it easy to submit applications to multiple lenders. Most lenders let you prequalify for a loan without a hard credit check, but you usually have to go through a hard credit check when submitting your application. A hard credit inquiry can reduce your credit score by a few points, so it’s best to apply for loans that have a higher chance of approval based on your credit score and income.
MoneyLion offers a free service to help you find personal loan offers based on the info you provide, you can get matched with offers for up to $50,000 from top providers2. You can compare rates, terms, and fees from different lenders and choose the best offer for you.
6. Wait for approval and funding
Depending on the lender, you may receive an approval decision within minutes, or it may take several days. The lender may ask you questions if the representative needs clarity about your application. Monitoring your email while waiting for approval can help you get through any speed bumps. Once approved, the funds will be transferred to your bank account.
7. Repay the loan
Loans give you money right away when you need it for necessary expenses, but you have to pay it back. Loans have varying repayment plans, and knowing what you’re walking into can make repayment more manageable. Borrowers should review the loan’s schedule before accepting the terms to make sure they can pay it back. If you are nervous about the monthly payments, you can extend the loan’s term to make them more doable. Some Lenders could charge extra fees if you make late payments, so it may be a good idea to set up automatic payments. This feature can ensure that you do not miss any payments.
8. Improve your credit score
Your credit score impacts how much you receive from a lender, if you get approved and the terms. It is a vital number that can save you thousands of dollars over your lifetime if you build it to a good score. Taking steps to improve your credit score before applying for a loan can put you in a better position when you need extra funds. Borrowers can make strides with their credit scores by paying their bills on time, covering outstanding debts and not applying for too much credit at once.
9. Use the loan responsibly
A loan is a financial obligation that you have to pay back over time. The extra funds can help you cover emergency or unexpected expenses and save you from short-term financial obstacles. A loan is a useful financial product for emergencies, but turning loans into a habit can weaken your finances. Too many loans can pull you into debt and increase your costs as you shell out more on interest rates.
Get the extra cash you need for an unexpected expense
A $500 loan can help you out of a jam and give you time to repay the debt. When used responsibly, loans can aid your finances and offer stability. You never know when a surprise expense will show up, but having access to short-term loans can make those costs more feasible to cover.
Can you get a $500 loan if you have bad credit?
Yes, you can get a $500 loan if you have bad credit. You will have a higher interest rate if you have bad credit.
What are the options for getting a $500 loan?
Some banks, credit unions and online lenders cater to borrowers with bad credit. You can also consider cash advance apps and peer-to-peer lending platforms.
How long does it take to get approved for a $500 loan?
Each lender has a different approval timeframe. Some lenders give you funds within 24 hours, while it may take a week for other lenders to give you a $500 loan.