by Susan Paige
If you know anything about cash money loans, you know how difficult it can be to pay it off in a timely manner.
Without proper advice and guidance, cash money loans can take forever to pay down and leave you feeling frustrated and discouraged.
There’s no need to fear! Read on to learn five easy ways you can pay back that loan quickly so you can move on with your life.
1. Make Payments Every Two Weeks
If you really want to whittle down your debt, start paying off your loan every two weeks instead of once a month. When you do this, you will reduce the amount of interest you pay, which will also bring down the balance much faster. Write down the dates you can pay on your calendar to help you keep track.
Not only will paying bi-weekly get the balance down, but it will also take off several months of the life of the loan. This means you’ll pay it off much faster, and you’ll pay less interest so it’s a win-win. Talk to your lender before you pay this way just to ensure you won’t get stuck with any prepayment penalties.
2. Round-Up When You Make a Payment
It might not seem like a big deal, but rounding up your payments can get rid of those cash money loans and their balances a lot faster. You don’t need a ton of extra money to round up your monthly payment, but it will definitely shorten the overall life of the loan. The amount you round up to is completely up to you, but the more you pay the better it will be.
For example, if your monthly payment is $120, pay $200 each month instead. Not only will rounding up pay down the balance faster, but it will also make balancing your checkbook and keeping track of your money a whole lot easier. Over time, the amount you rounded up will make a significant impact on both the interest and the repayment terms of your loan.
3. Make Some Extra Cash
If you’ve already budgeted your payment every month and have very little wiggle room, it can’t hurt to try and make extra money on the side. Sell stuff you don’t use anymore online with websites like eBay or Craigslist.
Come up with a few ways you can adopt a new side hustle that will bring in additional money every month. Take all of your profits and apply them to your loan balance and watch that number go down faster. Even something like working overtime can be a great motivator to help you pay off that cash money loan a lot more quickly.
4. Add One Extra Payment Per Year
Not everyone can afford to make bi-weekly payments toward their loans in cash. If you make just one extra payment per year, it can still have a pretty significant impact on the balance of your loan.
If you’re on a tight budget and can’t afford to make a full extra payment, take the amount of your monthly payment and divide it by 12. Apply this amount each month to the normal payment to help pay it off faster. Every single extra payment helps reduce your balance and interest, so it’s a great idea to pay more whenever you can.
5. Ask About Refinancing
Some companies offer refinancing options for cash money loans which can help you get a lower payment and save on interest. Find out if your bank or credit union has an option for personal loans so you can pay down the balance quicker.
A loan refinance may reset the terms of your loan, meaning you’ll have to pay it off in a longer amount of time. A lower rate and smaller payments are still beneficial, and you can always continue to pay more or choose to pay it bi-weekly. Refinancing is a great option for people who want to reduce their interest and get the loan paid off faster.
6. Cut Down on Your Spending
One great way to make more money to pay toward your loan is to cut out excess spending. Sit down and write out your budget, including every single thing you pay each month. Learning how to budget will help you get out of debt much faster since you’ll have a clear picture of where your money is going.
If you can get rid of cable and sign up for a streaming service, you could easily add an extra $50 or more to your monthly income. Wherever you can save, use that money and apply it to your loan instead. When you cut out the extra, you’ll be pleasantly surprised at just how much money you can use to pay down your debt.
Pay Off Cash Money Loans the Easy Way
From making one extra payment a year to bi-weekly payments, there are plenty of ways you can get rid of those cash money loans. Try to make extra cash whenever you can or cut back on spending to pay down your loan faster.
Remember that the more you pay toward the loan, the less interest you’ll pay and the shorter the loan will be. And, once it’s paid off, you’ll have that money to spend on other things that are important to you.
If you’re looking for new ways to get out of debt or pay down your creditors, check out our website for lots more posts and helpful information that could change your financial life.