In many cases, payday loans can appeal more to you when you are staring down any desperate situation. Although, they aren’t really going to be the solution you are looking for regarding any financial needs. You want to keep in mind that there are always going to be alternatives when dealing with payday loans. What you have to do is determine what the best alternative for you is, but ask yourself, what exactly is a payday loan?
Well, a payday loan is basically a short-term loan that could be up to $1000 or less. In terms of the due date, it’s usually due back within the next two weeks or a month. Essentially, a payday loan is designed to float you as a borrower, It can be useful if you are in a rough spot but need some cash fast.
One of the main appealing reasons payday loans stands out is that you don’t really need much to receive one. All you need is your address, a couple of references, and your proof of employment. Just like that, the loan will be yours without the hassle.
You may have good credit or you may have bad credit, you won’t have much to worry about. Online payday loans typically charge a quick flat rate. This flat rate could be from $15 to $30 per every $100 that was borrowed. Payday loans average around 400% APR per loan, and that’s for the best options. It’s true that if you pay your loan off within the first two or four weeks you’d only be paying about 15% to 30% per loan. While that may be true, people aren’t’ seeing the problem beneath it all. You pay the loan off early, within two weeks, but then you end up taking out another so you can get buy again. It’s a cycle that you don’t want to get stuck in because it’ll be hard to get out of it.
To summarize, it’s best to stay away from payday loans and think about the best alternative options. Even if you have bad credit you’ll be able to find the right alternative for you to go with.
Trying Getting A Personal Loan
Qualifying for a credit card is difficult your credit card score isn’t where it should be. Instead, you can consider a personal loan from a credit union, bank, or even a P2P (peer-to-peer) lender as well. Personal loans are just as capable as anything when in need of emergency funds. Unlike payday loans, you will be able to make smaller payments over time to pay back the personal loan you took out. This will also help you improve your credit score as the loan is being paid off.
Use A Credit Card Instead Of Applying For A Payday Loan
If you need fast money, then consider using a credit card to cover any emergency costs. If you have a paycheck and average credit (or even excellent) this method is very much possible. It’s a great alternative rather depending on a payday loan. Qualifying for a credit card is a good route to take, and you should consider one with a 0% APR rating. Depending on who you go with you may get your card within a week, or even overnight which may cost extra.
These are two alternatives that will keep you from digging yourself into a hole. Avoiding payday loans should always be something for you to keep in mind. Go with alternatives so you won’t have to deal with any hassles in the future, it’s better, easier, and safer that way.