by Starla Ross

Created on: June 05, 2008   Last Updated: June 19, 2008

Everyone runs into a money snag every once in a while. Although you may find yourself in a short-term crunch for quick cash, you certainly don't want to complicate things by having your short-term problem turn into a long-term financial mess. Avoid these five mistakes in your rush to raise funds:

PREDATORY LENDERS

Predatory lenders are described as "predatory" for a reason. They "prey" upon debtors who are in seemingly desperate situations willing to pay their hefty price tags. While your situation may seem desperate, you don't want to find yourself with debt you're not able to pay back when your situation improves. Be wary of advertisements you may find in your mailbox or a telemarketer who tries to sell you on a loan over the phone. Freddie Mac, the U.S. Government-sponsored mortgage business entrusted to make housing accessible and affordable, offers information about predatory lenders and how to avoid them. More information can be found by calling 1-800-336-3672 or visiting their site on the web. (

http://www.freddiemac.com

PAWN SHOPS

Pawn shops may seem like the perfect place to take your wares for a loan if you're looking for extra cash, but think again. Pawn shops notoriously pay less than what you could fetch for an item on the open market, say at an online auction service like eBay (http://www.ebay.com ) or CraigsList (http://www.craigslist.org). Also, if you decide to loan your item to the pawn shop instead of selling it, you'll easily pay up to 20% in interest charges for the service.

UNSECURED LOANS

Loans not secured by collateral (such as a house or a car) can be offered by both predatory lenders and legitimate, honest lenders. When your cash crunch is over, you may find yourself with a large monthly loan payment you're unable to repay. While it may be tempting, consider other sources of cash first.

TOO MANY CREDIT CARDS

You may think having five credit cards (with matching credit lines available to you) may just be the answer for the cash you're seeking. The problem? Too many lines of credit can mean too many future problems. First, there's your credit report to consider. If you have a number of credit cards maxed to their limit, your score decreases considerably. Worse than the possible damage to your credit report is the fact that too many credit cards can cause you to be financially overextended. Several cards at a high interest rate can easily deplete your monthly budget, causing you to have even less cash than that with which you started.

If you're

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