Life happens. And when it does, there's often a bigger price tag on it than you might have expected. If your emergency savings can't see you through a cash crisis, you may have the choice between using a credit card or taking out a personal loan. There are pro's and con's to both options.
When to use a credit card: If it's a short-term problem, you can use a credit card and pay off the balance fairly quickly. Using a credit card is a convenient way to deal with it. But credit cards often carry a higher rate of interest than a personal loan, and that interest can add up over time. Or if you need to borrow a large amount, it might put you right up against your credit limit, making it difficult to use the card for other things you need. Bumping up against your limit also may affect your credit score, as one of the components of your score is the amount of available credit you have. Think carefully about taking out a cash advance on your card. The interest rate can be higher than that charged on purchases and there's often a 3% to 5% fee, and a minimum charge.
When to use a personal loan: Taking out a personal loan from the credit union may save you money in the long run, especially if you need a larger amount and need longer to pay off the loan. If you own your home, and have a major expense, a home equity line of credit or home equity loan may be your best option. A personal loan can also help you get the things you need if the merchant only takes cash or checks. You will need to apply for a loan, so it may take longer to get access to cash than using a credit card.
Contact the credit union for help. That's why we're here.