5 Legal Ways to Produce Cash During Emergency Situations

At one point in our lives, we've all been through a financial emergency. Your car breaks down or you had an unexpected job loss, making you feel like you've been strapped down with cash and you don't know what to do.

Although the best option is to save up enough money to avoid getting into debt, there are still some options wherein you can produce cash in emergency situations if you used up or never had an emergency fund.

Whatever situation you might be in, here are some ways for you to raise cash:

Pawn Shop

Pawn shops usually provide quick and easy, no-questions-asked loans. Plus, they don't have any restrictions on how you will spend your money. Note, however, that they only lend a fraction of what your possessions are worth. Meaning, you run the risk of losing your possessions if you're unable to repay your loan. Moreover, they also charge higher interest rates.

Another alternative is to try selling collectible items in old coin shops that will usually buy anything with gold or silver in it. If you're not sure if the necklace you've inherited is gold, they will test it out for you. Moreover, you can check the house for anything that may contain these precious metals.

Cashing your Investment

Although not an ideal means of obtaining cash, you can consider cashing your investment as a possible option if you have limited resources available.

Be warned though that cashing in stocks or bonds may require you to pay tax penalties, mainly if these funds are invested for your retirement. So it's unlikely that you will be walking out of your investment office or your local bank with the cash that you need. Therefore, it's not the best choice to produce some money during emergency situations.

Loans for Home Equity

If you need a large sum of money, you can choose to borrow against the equity of your home. Though less frequent these days, they still do exist. For example, senior citizens are eligible for reverse mortgages, which does not require them to pay monthly payments. However, they can remain at home.

The catch of home equity loans and reverse loans, however, is that these must be repaid. Otherwise, heirs or homeowners may run the risk of losing the property.

Personal Loans

It can be challenging to apply for loans for people with a bad credit record. However, it is still possible. Several finance companies offer quick cash loans even for people with bad credit records.

Yard Sales

Think about all the things you hardly use anymore. Chances are, you can still sell most of them. You can set up an old-fashioned yard sale in your garage or better yet, post an ad online on Facebook, eBay or Craigslist. Not only you'll remove the unnecessary clutter in your home, but you'd be surprised by the amount of money you'll be able to raise.

Start Collecting Debts

If anyone owes you a couple of bucks, then it's time to collect. It might be easier when said than done, but there are some ways to increase your odds of collecting. One way is to offer a discount. For example, you can tell your friend that you'll only charge $200 from the $240 he owes if he can pay you within the day.

However, if the person who owes you doesn't have any way to produce cash, you can suggest taking valuable items instead. The main idea is taking stuff that can sell immediately as payment. To be sure, know the ongoing market value of the possession first before accepting anything as payment.

Have a Friend Use Your Credit Card

If your credit card has a low cash advance limit, one way to quickly raise money is to tag along with your friend's shopping trip. If he's planning to spend a lot of money, you can offer to pay it with your credit card in exchange for him giving you the cash. Maybe you'll give him a little treat like offering to pay for lunch afterward. Meanwhile, you'll have the extra money now, minus the higher interest rates and the usual cash-advance fees.

Do Odd Jobs

Kids do it all the time. They’ve been babysitting, running errands, shoveling snow to be able to raise cash. If you have a lot on your plate, consider doing odd jobs to raise enough funds. You may offer your services like walking your neighbor’s dog or shoveling snow on their driveway. Be ready and have the necessary equipment that you need so that you can start as soon as you can.

In Summary

An unexpected event can leave you stressed out as you scramble for enough cash to pay the bills, the mortgage, etc. Applying these tips can generate sufficient funds and can help secure your finances in the long run.