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Consider An Advance On Your Credit Card Instead Of A Payday Loan
When our readers hear stories about online financing, they often think more of a payday loan, which is what they are in the truest sense. Yet credit cards are also a way to get fast cash. With this method you are taking an advance which must be sent back to your creditor. Most often the user plans to purchase something that they don’t need in the long run. Common items include a TV or vacation and those are a fry cry from real financial emergencies like medical bills and car repairs. Much like a direct online loan, you’re borrowing money at a high interest rates which requires a set payment over a certain amount of time. However, there are some scenarios where an advance would be preferable instead of working with a direct payday lender which we’ll get into now.
Each one of these options will leave you with different things to consider. When you work with direct payday lenders, you’re going to have a few different choices when it comes to rates and terms. As you’re using your next paycheck as collateral, you need to stay employed and continue monthly direct deposit. Consider the various payday advance services that are available to you. Check out our list of direct loan companies that provide funding. We all think of online lending as a form of borrowing that assists us with short term financial needs. With that, it can also be a problem that lasts for months and even years after the initial loan was issued. Think about stories you hear where someone takes out a direct lender loan and then loses their job. Now they can no longer make payments with each payday and they default on the loan.
Another option besides an advance or direct loan is to borrow cash from a friend or neighbor. You will see a lower interest rate than a bank loan or credit union. In fact, most of your friends or family members won’t charge you interest at all. Be careful when borrowing money from people you know. We hear all the time about friends and family members who lost relationships. Often because someone borrowed emergency cash and failed to pay it back. Some people find themselves fighting with family members over a few hundred dollars. Situations like these mentioned above in the minority. But you can never be too careful when dealing with family and finances. While this aspect is negative, you can expect a decent interest rate with no fees while working with someone you know. Compare that to working with direct payday lenders where the finance charges will be high.
A large percentage of applicants for direct loans have bad credit and thus aren’t candidates for an advance from a creditor. Most credit card companies will require a decent to good FICO score and that’s out of reach for most applicants who are trying to rebuild credit. Some services exist for those who have bad credit. You can look into a secured card. Also consider a high interest rate card. Finance charges will be high, especially with an online advance. But they won’t even approach what you see with most direct lender loans. Contact your creditor to determine whether or not your eligible for an advance. The US Government recommends you read up on your rights as a credit card holder in the US. Credit cards are an easy way to get an item now and pay it back later. Most companies will specify these terms in the contract language. Search for a legitimate company who has the borrowers best interest at hand. Try to avoid an installment loan from a direct lender. With improvement to an applicant’s credit profile they can get on the way to a future bank loan from a credit union. Make sure to use cash advance or direct lender loan for something that’s a true financial emergency. Anything else is irresponsible when you factor in the high finance charges from payday loans.