If you are struggling to pay a bill, such as an electricity bill, you may wonder whether a cash loan will be the answer for you. There are lots of loans available but this one might seem like it will be the best. It is important though, to make sure that you are totally aware of all of your options so that you are sure that you are making the right choice.
A cash loan could be useful because it will help you to get the money quickly. A cash loan is normally really fast to organise and to get the money. This means that if you need to pay off the electricity bill really quickly then it can be a really good option. You will also find that a cash lender will not normally worry about whether you have a good or bad credit record. If you have a poor credit record then it likely that you will not be able to borrow money from many sources and particularly not from traditional lenders. This means that it could be a really useful option for some people.
If you already have a credit card then it could be possible to use it pay the bill. Some utility providers allow payment by credit card and some do not. There may also be a charge to pay by card so you will need to investigate this. If a card cannot be accepted then you could use the card to draw out cash and then use that cash to pay the bill at a post office or pay it into your bank to pay it by BACS or direct debit. However, a cash withdrawal on a credit card can be very expensive. You will charged interest on it right away and you could find that this will work out to be a very expensive option. Another alternative is to use the card for other things, such as food shopping which might leave money available to pay the bill. A credit card does not have to be repaid very quickly either. This can sound like a good thing, as you will just have to repay a minimum amount which might only cover the interest and you could keep paying it over a long period of time. This means that the amount of interest charged could really add up.
An overdraft can seem like an easy option but it can be very expensive. Overdraft rules have changed recently and charges on all overdrafts are now 35-40% in most cases. This can be extremely expensive especially compared to how much arranged overdrafts were before. Overdrafts only get paid off when you get money paid into the account. This means that they can be outstanding for a long time and this can cost a lot of money.
If you have savings then it could be a good idea to use these to repay the loan. It can be difficult to use savings though. This might be because the money is tied up, perhaps in a bond but is more likely to be because you do not want to part with it. If you have worked really hard to build up those savings then you might want to use them for something really special. It might be that you have already planned what you are going to spend them on. You may also not want to lose the interest that you are earning on them. It can be a good idea to calculate how much the loan would cost and how much interest you will lose and compare them as that could change your mind about losing the interest.
Ask electricity company
It could be wise to speak to the electricity company to see whether they can delay the payment. Sometimes they may be happy to wait for you to pay until you have more money. They may charge for this though and you will need to find out whether that will be more expensive than other options that you are considering. If you are in credit on your bill they might be able to use some of that credit to go towards paying it off.
So, as you can see, cash loans could be a useful option for paying your electricity bill. However, it is worth considering all of the options that are available to you. You will then be able to decide which you think will be the best. It could be that you would prefer to use a more expensive method because it suits you better, but it is good to find out the costs of each method and think about how they will work so that you can decide on the one that you think will give you the very best value for money.