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Urgent cash loans
Gain fast access to the cash you need and overcome a short-term financial hurdle.
Sometimes life throws you a curveball and you don’t have the financial capacity to cope. It could be an illness or injury, expensive car repairs or a short-term cash flow problem when several unexpected bills drop into your inbox at the same time.
When this happens, you might need an urgent loan to help pay your bills and get your finances back on track. Compare short-term loan options below to find out what choices are available when you need money in a hurry.
How does an urgent loan work?
An urgent loan is a short-term loan designed to provide the funds you need in an emergency. You can use this money for just about any purpose, from urgent car repairs to paying essential bills, and you must repay it during a term ranging from 2 days to one year. Although a good credit history makes it easier to gain loan approval, some lenders also offer urgent loans to borrowers with bad credit.
There are three types of loans available to New Zealand borrowers:
- Short-term loans. Also known as ‘Payday loans’ , they are usually loans of between $100 and $2,000, and you typically pay the money back in line with when you receive your regular income.
- Unsecured short-term loans. These types of personal loans do not require you to offer an asset as collateral for the loan. Usually available with a minimum loan term of one year, short-term unsecured loans need you to meet strict lending criteria and typically come with higher interest rates and fees than secured loans.
- Secured short-term loans. A secured personal loan allows you to borrow up to $10,000 when you offer an asset, for example, your car as security. Because there is less risk for the lender, you can typically access lower interest rates and fees.
⚠️ Warning: be cautious with short-term loans
If you're experiencing financial hardship and would like to speak to someone for free financial counselling, you can call the MoneyTalks helpline operated by FinCap on 0800 345 123. It is open from 8:00am to 5pm, Monday to Friday and 10am to 2pm Saturday. When comparing short term loans, ensure you take into consideration any fees, charges and rates you may be charged.
Alternatives to short-term loans
Consider these alternatives before applying for a payday loan:
- Use online Government resources. The Commerce Commission New Zealand website explains how loans works and what to be aware of when borrowing from a lender.
- Payment plans. Talk to your electricity, gas, phone or water provider to see if you can work out a payment plan or receive an extension on your due date if you’re behind on payments.
- Contact your creditors. Speak with creditors about extending the due date of your payment, or working out a new payment plan that works for both of you. Seek personal loans elsewhere. Consider a small personal loan from a bank or a credit union. You may qualify for a loan with much lower interest rates than those offered by payday loan companies.
- Pay with credit card. Consider paying with your credit card to cover your emergency bills or payments. This is not a long term solution, as you’ll need to pay off the balance as soon as possible, but it’s an alternative to a short term loan with high – and immediate – interest rates.
Loans you can compare today
Features of urgent loans
Urgent loans usually include the following features:
- Short-loan terms. You typically have between 2 days and 1 or 2 years to pay back the money you borrow.
- A loan from $100. If you choose a loan from a payday lender, loan amounts range from $100 up to $2,000. Depending on your financial circumstances and the lender, it may be possible to borrow more through a secured or unsecured short-term loan, sometimes with amounts of up to $10,000 available.
- High fees. Short-term loans also tend to attract higher fees than traditional personal loans. Look for establishment costs and ongoing monthly charges when you compare loans.
- Fast application and approval. As these loans usually involve borrowing a small amount for a short period, many lenders offer quick and easy online applications. Some lenders can also provide instant loan approval and transfer the funds into your bank account within one business day.
- Missed repayment penalties. One final feature you should be aware of with urgent loans is that lenders usually impose strict penalties if you miss a repayment. These fees can be substantial and could lead you further into debt.
Pros and cons of urgent loans
Before deciding whether an urgent loan is a right solution for your financial needs, consider the benefits and drawbacks of this option.
- Easy to apply. Urgent loans are quick and easy to apply for, with many lenders offering a simple online application process.
- Quick turnaround time. You can receive approval for an urgent loan very quickly, and it can give you access to funds within one business day, which guarantees fast access to money when you need it most.
- Bad-credit borrowers accepted. A bad credit history won’t necessarily stop you from getting an urgent loan, as some payday and personal loan lenders offer finance to bad-credit borrowers.
- Expensive. Short-term loans, especially payday loans, have high fees and high-interest rates. Even if you only borrow a small amount, the total cost to repay the debt in full could be much higher.
- Can be risky. The high cost of an urgent loan can end up leading you deeper into financial difficulty. The payday lending sector is also notorious for attracting unscrupulous lenders, so you need to carefully read the terms and conditions before applying for a loan.
Things to avoid with urgent loans
Urgent loans can help you to get out of a tight spot and provide the money you need to get your finances back on track. However, they also come with a few risks attached, and it’s essential you are aware of these dangers before signing for a loan.
Problems to be wary of include:
- Taking on too much debt. If you’re already in debt, borrowing even more money may not be the best solution to your financial problems. Make sure you’re aware of all the associated risks when taking on additional debt, and that you can afford to repay what you borrow.
- Applying for too many credit products. Asking for multiple credit products in a short time can hurt your credit file. Keep applications to a minimum and only apply for loans that offer a good chance of approval.
- High fees. The cost of a payday loan is quite high, so make sure you can afford the total cost before you apply.
- Short repayment terms. Urgent loans have short repayment terms – you can repay some in 2 days. Before applying for a loan, you need to be sure you can pay the full loan amount, plus any interest and fees, within the specified time frame.
How to apply for an urgent loan
Many urgent loan lenders offer online applications to make it as quick and easy as possible to apply for a loan. You need to check that you meet a few simple criteria before applying, eg:
- You must be at least 18 years of age
- You need to be a New Zealand citizen or permanent resident
- You must be in paid employment and earn a minimum income
If you meet these criteria you can then apply online by supplying:
- Your name, date of birth and contact details
- Proof of ID, eg passport, driver’s licence, 18+ card
- Recent payslips and bank account statements
- Information about your income, employment, assets and liabilities
Lenders typically assess applications quickly, with some transferring the loan funds into your account within 24 hours.
Frequently asked questions about urgent loans
There are several viable options to choose from if you need money in an emergency. However, make sure you carefully consider each potential loan option to make sure the one you choose is a good fit for your financial situation.
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