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I am working at a software consulting company and they just informed me that I am going to need to relocate for my new client project. Problem is that it is on the other side of the country, over 1200 miles away.

My company does reimburse me for the moving costs, however the problem is not the reimbursement. It is that I don't have the money or credit available to spend for moving.

My Credit has taken a hit over the past year and has gone down to the mid-upper 600s from its near perfect credit score, and I have less than 1000 dollars in my bank with a maxed out credit card. This has been due to: an unexpected move, that due to bad paperwork was not able to be reimbursed; car trouble; among other things.

The moving costs will likely come to about 2000.

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    Have you talked to your employer about alternative options? They might have a company card they can use for expenses, which would remove reimbursing you from the process. – BobbyScon Jul 24 '18 at 15:43
  • Or can you reduce moving expenses to what you can afford? Like moving yourself instead of hiring a company? Or getting friends to help move in return for payment later? – D Stanley Jul 24 '18 at 15:45
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    Not really answering the question, but why would you pack up and move 1200 miles away? Wouldn't it be simpler, in the current market, just to find a new job in your current location, perhaps with a higher salary attached? – jamesqf Jul 25 '18 at 4:28
  • You're saying you didn't get reimbursed once because of "bad paperwork"? Is that reimbursement from the same company? Why trust that they'll reimburse you in the future? – Glen Pierce Jul 26 '18 at 15:16
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Some employers will give you an advance. They will give you a deadline to provide documentation for the expenses. They then either require you to pay them back if the advance was too large, or provide you with additional funds if the amount advanced wasn't enough. You will have to ask.

It isn't likely that a company will give you access to a company credit card, unless they have already done so for other reasons. You can also run into an issue with some (many?) company cards because they run a credit check on the employee. This may mean that the credit card company could reject your application.

Even if they advance you the money, or you get money from a loan, you still have the problem related to using the funds. Some vendors might not accept a debit card for the contract: this typically causes problems when renting a car, or checking into a hotel. Putting the expenses on a credit card that isn't paid off each month, adds to the interest costs you have. And if the cards are maxed out, there is no room.

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Your options for borrowing money for moving expenses are really the same as borrowing money for anything else:

  • Take a loan out with a bank
  • Open a new credit card and hope you can get a high enough limit
  • Borrow from friends or family
  • Not borrowing, per se - sell a bunch of stuff or do more DIY/recruit friends or family to assist.

Obviously, there are pros/cons and caveats to each option and your options will be limited by your credit score and income factors.

The best approach, in my opinion, is to discuss this with your employer. Let them know that you don't have the funds available to pay for moving expenses upfront and be reimbursed for them later. I would ask if they could put the major expenses onto a company card instead. This will likely result in a more scrutinized expense review (finding a cheaper mover or van rental company for instance), but that's just the compromise. That might not be the case and they might just let you charge what you feel is appropriate, but just be aware of that.

There is a potential benefit in opening a new credit card. It'll be hard to get approved for anything with a sub-30% interest rate or a higher card limit because of your score, but there are options out there. If you get the card, only use it for moving expenses and subsequently pay it in full with the reimbursement and then don't use it again, there is a benefit to your credit score in a longer view of having more available credit compared to credit utilized. Obviously, the major potential drawback is that you aren't disciplined and end up maxing that one out too resulting in even more financial problems. You score takes a small initial hit on the credit pull to open the account, but that goes away relatively quickly. This is not the best approach or one recommended lightly. This is just an alternative thought process for consideration.

Borrowing from friends or family is generally strongly discouraged because it rarely ends well. However, because this really is a short-term loan, I still feel that it's valid for consideration if it's a possibility. Again, not the best approach, and one I would not recommend for normal borrowing situations. But, because you would be reimbursed quickly (presumably), I see the risk as much lower for recommending this if you are a trustworthy person that will actually pay back the loan right away rather than risk a relationship by spending the reimbursement on other things.

To reiterate because this answer got longer than I originally expected and I want to make sure it sinks in: Don't borrow money unless it's the only option actually available. Go talk to your employer and try to figure out a better method for paying for these expenses.

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