Comparison Between Quick Payday Loans and Credit Cards

Financial Condition of a person does not remain same all the time.

Which is better option, credit card or payday loan

Payday Loans Vs Credit Cards.

You may feel under depressive condition and need some quick money. For getting hassle free money, you have two options available. One deals with the payday loan and other is cash advance from credit card. We are going to discuss the righteous path between these two.

The first consideration is concerned with your credit availability. Is it sufficient enough for your ongoing financial crisis? If you have no credit card, it will take more than a week to get the card. The best and wisest option is applying for a payday loan from an Approved Money Center. They will just send the money directly in your bank account. So, this is more profitable.

The payoff session for a credit card loan takes months.

You cannot get more money before paying the full amount. Comparing with the payday loan, the lenders will not abandon you. You can apply for the second paycheck without the completion of first credit. Well, you will need to continue paying a credit card loan for a long time. Sometimes, the amount you needed crosses the aggregate credit. Payday loan is preferable in this type of situation.

You cannot use a credit card in every situation.

For an automobile workshop, cash gets the first priority. In emergencies like fixing or repairing your car, you can avail cash of the payday loan. It takes only an hour to apply and get it directly into bank account. Some shops decline credit cards just for the high maintenance fees. When you are advancing cash from card, bear in mind that the interest rate is really a little.

A payday creditor is more flexible than a credit card company. You have no option for drop an application for the second time loan for availing cash advance. But you can just go to an Approved Payday Center or apply over the internet for a second payday loan. This process is more user-friendly.

The last concern is the framework of interest rate and term.

Though the rate is lower for credit card companies, it takes more time to repay. On the other hand, your payday loan will ask you to pay as soon as possible. The higher rate will not affect much in your financial potentiality.

After considering above situations, you should make the decision. You should either apply for cash advance credit card or quick and fast payday loan.

What is the best way to finance?

Credit cards and personal loans offer, a priori, the same financial solution. They provide liquidity to cover certain expenses, whether unforeseen or not. However, it is not the same thing to fund yourself through a credit card than to do it through a personal loan. The latter allows you to face expenses with much higher amounts, to be repaid in longer repayment terms, while credit cards allow you to obtain liquidity in the very short term, quickly and flexibly.

Advantages and disadvantages of financing through a credit card

Although many consumers consider the use of credit cards to be dangerous, the truth is that their proper use has many more advantages than inconveniences. Flexibility, comfort and the ability to control at all times the situation of our bank accounts are some of the advantages offered by financing through credit cards.

Flexibility would undoubtedly be one of the biggest advantages of credit cards since they offer the possibility of financing purchases or expenses in different ways:

Fractioning payments: through this form of financing the client will know from the beginning what fees will be paid and when the debt will settle.
By monthly terms: allow the customer to know what the payment will be made on a monthly basis.
Paying a percentage on the debt: it is probably the least attractive of the three options, since when paying a percentage on the debt will always remain a debt pending amortization that will generate more interest.
But beyond the flexibility in making payments, credit cards have another series of advantages to take into account:

Interest zero: no interest is applied if the debt is settled month by month. It would, therefore, be like receiving a one-month loan at zero interest.
Return of a percentage of the purchases and programs of points: some credit cards return to the holder a percentage of the purchases made with them. Others, in addition, offer a program of points with which the owner can enjoy certain advantages.
Insurance included: most credit cards carry a number of insurance (accidents, travel, etc …)

However, not all benefits. The amount that can be accessed through a credit card is more limited than that offered by the personal loan. In addition, according to experts of bank comparator Bankimia, the misuse of a credit card can be a strangulation of the family economy. It is advisable to be very careful if you decide to use a credit card as a financing option. You should pay special attention to the credit limit granted by the bank. Surpassing it can lead to serious financial problems.

Advantages and disadvantages of financing through a personal loan

Faced with the flexibility of credit cards, personal loans allow the client to request higher amounts of money to repay in longer repayment terms (between 5 and 7 years). The advantages of personal loans over credit card financing are in interest rates that, although high, do not even reach those who apply plastic money.

At present, the average interest of a consumer loan is around 8.5-9%, although personal loans with higher interest rates of up to 14% can be found. But the biggest problem at the moment of personal loans is the difficulty of accessing finance.
Banks are restricting the granting of loans to the maximum, due, among other things, to high levels of delinquency. According to the Bank of Spain, the rate of doubtful loans in our country has been reduced to 10.4% as a result of the transfer of assets to Sareb, even so, this figure is still considerable.

Also in reference to personal loans, it should be noted that in case of not being able to pay the monthly loan payment, the holder of the loan must pay the commission for claiming debit positions and the interest for delay that is stipulated In the loan agreement.