Why Choose Short Term Loans Over Credit Cards?

3 Minutes Read

When emergencies strike and you need cash fast, traditional lenders and banks might not be the right option for you because they will make you wait for a long time before to approve your application. However, you do not have to make financial decisions hastily if you need cash fast and are running out of time. Take a little time to consider the pros and cons of the ways you wanted to use for obtaining short term loans.

If you want to use a credit card loan, make sure that you have one and there is available credit in it. If this is not the case, credit card is not an option for you because it will take weeks before its approval if you decide to apply for a credit card. Even if the lender approved your application for a credit card, he or she may reject your application for the loan since the amount may be high.

However, when you choose a short-term loan such as payday loan, you will need just few minutes to fill your application and receive the approval the same day. The lender will deposit your money directly into your bank account the next business day. You do not have to drive around town, to wait or to check cashing.

You have also to keep in mind that if you choose a credit card loan, you may need months to pay back the loan with a high interest rate. You will end up by paying a larger sum than what you needed initially. In addition, if you do not pay your loan on time, the lender might add extra fees. This is not the case with short-term loans. You need just a short period of repayment and you pay back the loan when you receive your next paycheck. The lender will charge a fee when you get the loan for being able to borrow. However, once you clear the entire loan and fee, you are completely free. If you are not able to pay back your loan o time, you can negotiate with the lender.

In addition, if you choose a credit card loan, you may face serious problems when clearing some of your emergencies bills. Some vendors and auto mechanics accept only cash in exchange of their services. The credit card lender will charge a high rate of interest. This is not the case with a short-term lender who knows that you need cash fast. The lender will never charge you more. Therefore, you have to think carefully before choosing a way for obtaining a loan.