Key takeaways

  • Emergency loans are a type of personal loan used to pay for unexpected expenses.
  • Types of emergency loans include personal loans, credit card cash advances, payday alternative loans, payday loans and car title loans.
  • To get an emergency loan, you'll usually need to provide details about your income, debts and credit score.

Emergency loans can be a lifesaver if you’re tight on cash and need to cover an unexpected expense, such as a pricey car repair or a medical procedure.
And getting an emergency loan works the same as getting any other type of personal loan. You’ll have to provide some basic information about yourself, including details about your income, debts and credit history, in addition to the loan amount and intended purpose.

But before you apply, you’ll want to get prequalified and compare your options to determine whether or not an emergency loan is the best option for you.

How to get an emergency loan in 5 steps

To apply for an emergency loan, follow these steps.

Compare lenders

Check out the interest rates, repayment time, funding time, features and credit score requirements for several lenders. This will allow you to choose the emergency loan that best suits your circumstances and financial needs.

Look at the lender’s reputation

Read customer reviews and check lenders’ ratings on sites like the Better Business Bureau or Trustpilot. This will give you an idea of whether or not you’re dealing with a trustworthy and reputable lender or if you’re better off getting the funds somewhere else.

Get prequalified

Most lenders will allow you to prequalify within minutes. By prequalifying, you can avoid a hard credit pull on a loan application where your chances of approval are low or interest rates are too high. This is important because a hard credit pull can temporarily lower your credit score.

Fill out the application

If possible, fill out an online application. Online loans usually come with same-day decisions. You’ll need to provide basic information about yourself and details about your income and employment. The lender may also require you to share documents like a government-issued ID and paystubs.

Wait for a decision and funding

Depending on the emergency loan and lender you chose, you shouldn’t have to wait long for an approval decision and funding. While most lenders will distribute your money via direct deposit, some will do so through a check or prepaid card.

What can you use an emergency loan for?

Emergency loans are meant for small, urgent expenses. Most lenders don’t have any restrictions on how you can use the funds, so they’re highly flexible. Common uses for emergency loans include car repairs, medical bills and emergency home repairs, such as fixing a leaky roof or replacing a faulty appliance.

What you can’t use an emergency loan for

Although there aren’t many restrictions on how to use an emergency loan, lenders usually don’t allow the funds to be used for illegal activities, such as gambling.

You also won’t be able to use a personal loan to pay for college tuition, though you may be able to purchase textbooks or cover other education-related expenses with one. Other restrictions include using the funds toward the down payment of a house or to pay for business expenses.

Alternatives for emergency loans

If you can’t get approved for an emergency loan, consider these alternatives:

  • Paycheck advances: Ask your employer for an advance on your next paycheck. If they approve, you’ll avoid having to take out an emergency loan and repay interest on the amount you borrow.
  • Payment plans: Reach out to your creditors, lenders and service providers and let them know you’re experiencing financial hardship. They may be willing to work out a payment arrangement with you by splitting up the amount owed into small chunks or changing the due dates.
  • Grants and interest-free loans: Call 211 to learn more about free assistance that may be available through charities and nonprofits in your local area.
  • Loans from friends and relatives: This option lets you steer clear of a formal application process or credit checks by lenders. Plus, you may be able to avoid paying interest on the loan.

Ultimately, you shouldn’t rely on an emergency loan or another funding source to cover everyday expenses regularly. If you often struggle to pay for your rent or mortgage, utilities and groceries, you may have an income or budgeting issue that you need to address.

Bottom line

An emergency loan can help you get over an unexpected financial bump if you’re strapped financially. Many lenders feature flexible eligibility criteria and extended payment periods, if needed, to give you plenty of time to get your finances back on track.

However, you could find that it may not be the best option for your financial situation. And in some instances, an alternative, like a paycheck advance from your employer, loan from a friend or relative or financial assistance through a grant program in your local area, could be a more viable solution.