Pay Day Loans Compared To Credit Card Cash Advances - Which Short Term Loan Is Better

Pay day loans have recently gone under an increased scrutiny from almost all levels

government who claim they are charging to high of an interest rate on the short term loan. Some states have passed legislation which capped the interest rate payday lenders are allowed to charge. This new legislation has shut down many retail stores throughout the effected states but has also created an emerging and very competitive online payday lending market. As new lenders consistently move online for issuing pay day loans the online lenders are lowering their interest rates to stay competitive. This has ultimately resulted in a better deal for the consumer and a recent study has found that online pay day loans consistently offer consumers a better rate than the retail outlets.

Now let's compare taking out a short term loan through a payday lender as opposed to getting a credit card cash advance. Let's start off with the credit card cash advance. These short term loans usually carry an interest rate of about 29% on average and are typically paid back with the minimum payment throughout the course of a year by the majority of consumers. What the credit card company doesn't tell you is that the cash advance is put at the bottom of your repayment cycle and therefore all the items on the credit card before the cash advance must be paid off first. Meanwhile your credit card company is charging you a high interest rate every month which can add up very quickly.

If you really want a short term loan that can be paid back and done with then you might want to consider pay day loans. A typical finance charge for this short term loan is $15 for every $100 that you borrow. Bad credit is usually not an obstacle is getting a payday loan. The most important thing that lenders look at is whether or not you have a job or a steady source of income. Having a job is really the ticket to getting the loan. The lender will use your next pay check as a security for repayment and if you cannot repay the loan on your next payday most lenders will give you an extension until your next payday.

Pay day loans are typically issued anywhere from $100 - $1,500 and can be deposited directly into your checking/savings account usually within 24 hours of filling out an application. For consumers who need to get cash quick then a pay day loan is by far the most convenient method is doing so.

I would strongly recommend that you search for a loan online as that's where you will most often find the best deal. There are a few good websites out there where you can fill out one application and receive multiple quotes from various lenders. These multiple lender websites will make the lenders compete for your loan and therefore you are guaranteed to receive a true market rate.

For a payday cash advance loan lender that has consistently provided competitive rates check out this link:

Legitimate Cash Advance Lenders

by: Matthew Couch

POST COMMENT

Credit Repair Book - How Do You Effectively Re-establish Your Credit? Dos And Don'ts For 0 Purchases Credit Cards Dos And Don'ts For 0 Balance Transfer Credit Cards How And Where To Apply For Bad Credit Loans Getting a good rate on a loan with bad credit - what you need to know Will A Loan Modification Hurt Your Credit Score? How to Restore Your Credit - The Most Important Basics Get An Online Payday Loan - How To Get Quick Cash Before The Next Pay Day How do Debt Consolidation Loans Help People with Extremely Bad Credit? Debt Consolidation Loan For People With Not So Good Credit? Do All Debt Consolidation Lenders Require Good Credit? Do Debt Consolidation Lenders Always Request Good Credit? Do Debt Consolidation Lenders Really Lend With Bad Credit?