Comparing loans can be a great way to get good deals on loans, as well as help you financially. Getting a good loan can improve your credit score, as well has have other benefits.
If you want to compare different loans, get out a piece of paper and write down the pros and cons of each. You should also pinpoint what you need the loan for, and if you will be able to pay it back in a reasonable amount of time. These things will help you choose a loan that will be best for your current financial status.
A risky option is choosing an unsecured loan. These are usually used by those that cannot afford any other type due to collateral issues, or people who cannot get cash advancements on a credit card. They have high interest rates, and if you are not careful they can land you in more debt that you anticipate. While, a secure loan requires you to give up something for collateral, so that if you cannot pay you give up your car, or house, or TV in place of that. While both carry potential risks, one can help you better than another depending on what your needs are.
A secured loan is a loan that has low interest rates, but you also have to put up a possession for collateral. It can be anything from a TV for small loans, to your own home for very costly loans. Interest is low, but if you know you cannot afford to pay it off, the risks are generally high. Unsecured loans and secure loans are beneficial, but it all weighs heavily on what your needs are.
A payday loan is generally a very short term loan that is used to cover expenses before a payday. It is exactly what it says it is. While these can be tempting if you need cash a few days or a week before getting paid, they also carry high interest. If your paycheck will be more than what you will have to pay back, then this could greatly help you. Payday loans are typically less than $1,000 in value. If you need a greater amount, you would need a secure loan. It sums up to, if you just need quick cash, go for a payday loan, if you need a lot of money, a secure loan is your best bet. Payday loans are also known as cash advances.
Credit cards also offer a specified amount of cash advancements. You can get up to a percentage of your total limit available for withdrawal from any ATM. They may or may not carry high interest, some credit cards offer very low interest on cash advancements. Compared to any other type of loan, they are much more convenient, but a bit risky. If you have an emergency a credit card financed advancement may be the way to go.
There are a number of options available for loans, and it is only a matter of finding what works for you and your situation.
Author: Chris ChanningThis author has published 19 articles so far.