Meeting Your Small Loan Needs

Sometimes, despite our best efforts at budgeting and planning, there's simply more month than money.  When that happens, we need a little help to meet our monthly expenses.  Throughout September, Montana Credit Unions for Community Development will be explaining the options available to consumers who have fallen behind on their bills.  And be on the lookout for our Public Service Announcement playing on TV and radio this September and October.  Watch it below:

The following are options for those who are struggling to meet their monthly expenses:

• Savings:  Having an emergency fund with money set aside for rainy days is critical to financial security. It means that when an unexpected expense threatens your monthly budget, you'll be able to borrow the money from yourself - at no interest. Experts suggest eventually saving 3 to 6 months income in a special savings account, but to begin with, aim for just $1,000. 
• Small Loans:  If your savings are inadequate to cover a large expense, then you may need a loan to help you get by. Be sure that the first place you go to inquire about a loan is your local credit union. All of Montana's credit unions make small loans, on a case-by-case basis, and often as small as $300. Credit unions are likely to offer the most competitive rates on their loans, and a repayment plan that allows you to pay in installments, rather than one lump sum. Whenever you're considering a loan, be sure you'll be able to repay it.  If not, you'll only find yourself deeper in debt.
• Speaking with Creditors:  Your creditors may be willing to modify your repayment plan if you explain your situation to them. The key is contacting your creditors the moment you fear you'll be unable to make your payment. Don't wait until you're already overdue.
• Repairing Credit Responsibly:  If you have a poor credit history, you may find it difficult to get a safe, affordable loan when you need it. Your first step to repairing your credit history is to know what's on it. Order your free credit report from www.AnnualCreditReport.com and review it carefully. If any of the information is inaccurate, you can dispute it with the credit reporting bureau and have it removed.  Beware of companies that claim they can remove negative information from your credit history, or give you a new credit identity, for an upfront fee.  This is a common scam, and it will only make your situation worse. For more on how you can repair your credit and avoid a scam, read "Credit Repair: How to Help Yourself" in the resources below.

Additional Resources:

Visit the Meeting Your Small Loan Needs page of our website to learn more about a credit union small loan.

Schedule of Non-Monthly Family Living Expenses:  This MontGuide from MSU Extension explains how families can prepare for irregular expenses, and includes a chart to organize them.

Credit Repair:  How to Help Yourself:  This FTC publication details ways consumers can repair their credit history, and warns consumers of credit repair scams.

Building and Maintaining Good Credit:  This publication from the USAA Educational Foundation provides consumers with a plan to establish and maintain good credit, as well as improving credit scores and getting out of debt.