Personal Loans and Payday Loans: Which One Is Better?⁣

Personal Loans and Payday Loans: Which One Is Better?⁣

Are you facing a financial predicament and can’t decide whether to pursue personal loans versus payday loans?

We can help you reach an educated decision. It always depends on your specific circumstances, but we’re happy to explain the difference between the two, identify which is better, and dispel a few myths about payday loans.

Personal Loans Versus Payday Loans

You can use personal loans and payday loans to pay for almost anything, but the difference typically boils down to how much money you require. It also depends on your credit score.

Personal (AKA, traditional) loans involve higher sums of cash, and their interest rates are better if you have a stronger credit score. Payday loans carry high interest rates, but they’re significantly smaller ($500 or less), with durations of only one to four weeks. In other words, you would use a personal loan for a larger expense, whereas a payday loan can help someone with a poor credit score cover more immediate expenses.

Why We Emphasize Payday Loans Over Personal Loans

Payday loans are some of our favorite financial tools because they allow you to avoid so much of the hassle you get with traditional loans.

  • Since they don’t require any credit history, you can skip the waiting periods and credit checks entirely.
  • Even though the interest rates are high, the short durations mean there is not much time for them to accumulate out of control. Long-term loans, at lower rates, can lure the borrower into a false sense of security.
  • Payday loans and other products (like installment loans) may be your only remaining option when you need to finance an emergency expense like an automobile repair.

Also, both loans can help you improve your credit if you make timely payments. In summation, payday loans can help you improve your financial situation after you’ve struggled with sudden expenses and/or a mediocre credit history.

Common Myths About Payday Loans

We often encounter a few unsubstantiated myths about payday loans. Here are the worst ones, including how to dispel them:

  • MYTH: They require a good credit history.

On the contrary, you can obtain a payday loan with poor or non-existent credit. Other factors like work history play a bigger role in loan approval.

  • MYTH: The online application process is less secure.

Our application process is one of the most secure because we utilize multiple security applications (Site Lock Secure, for example) to protect clients’ confidential information.

  • MYTH: You’ll have to endure hidden fees.

The Truth in Lending Act, the most relevant congressional legislation, requires lenders to be forthright with fees, terms, and conditions. Therefore, we always make sure customers have access to all information regarding the loans they purchase. This includes fees, rate, duration, and so forth.

  • MYTH: You can only borrow based on your income.

Income plays a role, but it’s not the only factor. Regardless of income, payday loans are of smaller value anyway because they’re intended for short-term purposes.

Find Fast-Cash Solutions with Lending Bear

Lending Bear offers multiple payday lending solutions that can help you escape a financial jam, even when traditional loans are off the table. Everything we do involves full disclosure, and our business complies with all state and federal financial regulations. As a matter of fact, you should never do business with an unscrupulous lending institution that cannot verify its credentials.

We subject ourselves to numerous audits and evaluations from organizations like INFiN (A Financial Services Alliance) and the Better Business Bureau (BBB). Our website also furnishes several customer testimonials to go along with over 5,000 5-star evaluations on Google Reviews.

Contact us today for professional guidance and customer service regarding personal loans and payday loans.