Payday Loans Vs Credit Cards

[adria]

Many people will sign up to a particular credit card based on the length of the interest free credit period, either for purchases or balance transfers from another card. Balance transfers usually have a longer interest free period, as the card companies have a guaranteed credit from the start. The first way they make money from this is to charge a balance transfer fee, of around 2% to 3% of the balance, which can add up to a lot if you're transferring a few thousand pounds. This is added to the total balance you owe. The companies are under no obligation to remind you of when the free credit period ends, and when it does, the interest rate can be as high as 20% to 30% plus. If you carry on making the minimum payments once the interest starts, its likely that your payments won't even cover the credit charges, meaning the debt will only go up. In the long run, you might even have been better staying with your original card if it had a lower rate, even if you had to find other means of making the monthly payments on time. This is the reason, why people prefer payday loans instead of owing a credit card.

[jason_simpson]

It depends on your circumstances and your present financial needs but if you’re requiring urgent credit and want to avoid possible long-term debt a payday loan is the clear winner.

It is unlikely that payday loans will surpass credit card use but they are becoming a popular alternative for those needing a quick, short-term credit solution in urgent situations. They also offer small amounts of credit to those who would normally be ineligible for a credit card.

[HarrisonD]

I agree that the choice between credit cards and payday loans depends on particular circumstances and situation. Either payday loans or credit cards have their advantages and disadvantages. So, it is only up to you to choose what is best in your very case.

[candy3]

I have a friend caught in a vicious circle with payday loans because she keeps having to renew the loan in order to afford the payment. You have to be really careful though not to get in the same trap as she is in. She has renewed her loan 8 times now.

On the other side I also have friends that have over 75k on credit cards.

Sad, I personally think both options should be avoided at all costs but if you have no where else to go they can save you in a pinch but like anything - you need to be responsible.

[markhenry]

can anyone let me know the difference between both these terms such as pay day loans and credit cards as i never bothered myself to know about it myself

[eguide]

Actually credit cards are the best way to get money in your emergency money needs situation. Because it includes number of monthly payments and you have a longer grace period, and you do not get penalized for paying this loan fast if you can afford. Another option is available to you that is getting a loan from private money lenders. Because in emergency situations it is very difficult to get a loan quickly. In that situation online payday loans are the best option for you.

[Michael01]

In my opinion, payday loan is only good for urgent need of money or having bad credit and not getting any financial assistance from traditional bankers .Otherwise , credit card is good if used with a good planning .

[ewanfisher]

Payday loan is better if you are in urgent need of money.

Regards
Ewan Fisher

[hostingcoupons]

i's in favor of credit card,as you may not know when you shall need the money. but 20%-30% interest rate is horrible. find a reputable bank is so much important

[jeffreyrogers]

In part, this is because lending rules by banks & credit card issuers have become more stringent. New rules are being developed, in cooperation with credit card companies, by the Department for Business Innovation & Skills, the BIS.

[paylan]

It is totally depends on your circumstances and your present financial needs but if you’re requiring urgent credit then a payday loan is the best choice.