Credit cards may look more attractive than fast online cash advance loans but the small minimum payments each month may just be deceiving your bank account. The responsible short-term loan lenders are not hiding the costs. The fees are defined and the interest rate is clearly stated. High interest every two weeks is a cost which should not be kept around for long. The focus to pay off one of these fast cash loans is stressful but a credit card will accept 1%-5% of the balance every month for as long as you want. Very attractive financial feature, but not money saving.
There is a two week term for online cash advance loans.
The payoff for direct online cash advance loans averages two weeks from the initial loan date. This means that a customer will need to come up with the full loan amount plus the fees. Typically a lender will charge a certain amount per $100 borrowed. The average is $30; so on a $300 loan, the full payoff will be $390. A borrower must pay off at least the fees. When there is no money paid towards the principle, the loan will remain difficult to pay down. There are customers who fall behind in other budgeted costs trying to pay off the loan. If there was no payoff plan set in place at the time of the transaction, the loans can prove uncomfortable to payoff. Cutbacks or alternative measures will need to be taken in order to get this loan out of the budget. Some people look at these loans as ugly while others are thankful for the opportunity and focus on getting it paid off as soon as they can.
Credit cards offer a whole different lending concept. These revolving accounts breathe easy payments. The minimum payment expected each month is a small fraction of the principle. Depending how much a person has used the card and at what interest rate the balance is being charged, the monthly demand ends up an amount which most often fits nice and comfortable into a budget.
If a credit card balance carries a balance of $300, the minimum payment will average $15. This is definitely more comfy than the $90 of the fast online cash advance loans. The arguments are clear and well justified, for now. The sad part of this is there is no long-term accountability. A person will struggle and fight to pay off a bill which is making their budget uncomfortable. Short-term loans are high interest loans which hurt finances if left out for the long-term. With revolving accounts, there isn’t the same sense of urgency. In fact, the $15 payment could even be affordable with an increase. Many consumers justify purchasing wants or overspending with cost of living because an extra $10 a month is no big deal if the charge card continues to be used.
- What happens if the interest is raised?
- Is the credit limiting the ceiling for how much to spend? If the card company raised the limit, would you spend that too?
- How efficient are you in making on-time payments?
Look at your financial reality and how you manage your money. Credit cards which sit for years with unpaid balances carry a high price for comfort. When you use low cost online cash advanced loans, you will have your debt paid in no time and then live with a comfortable budget.