With payday loans now being offered online, at banks and credit unions, people are more confused as to where to turn to obtain fast cash. Normally, a bank offers a sense of security and trust which is not found with just any payday loan lender. Credit unions fall right into place behind banks. Their smaller size and member run organizations attracts those looking for financial help. With all the bad publicity brought upon the payday loan industry, it is no wonder why customers are turning to the banking institutions and credit unions for help.
There is a distinct difference between banks and credit unions as far as how they are run, but they are very similar in practices. Some people find that credit unions are more people friendly with lower interest rates and member status with voting rights. Others like the big business aspect of banks and feel more secure with their status in the financial world. Then there is the direct lender which will provide payday loans online or at storefronts. These companies do not offer other services that banks and credit unions provide. The short-term high interest loans are based on present income and having a well-managed bank account.
Payday loans online will want you to have a well-managed bank account.
In order to do payday loan business with banks and credit unions, you will have to have an account with them. The online payday loan industry works with most banks and many of the credit unions. One major difference between those financial institutions and the direct lender is once a loan goes to default; a more serious negative can come to your bank account besides the fees and interest. A bank or credit union will have instant access to any deposits you make as well as have any opportunity to freeze your account if you do not pay. Since insufficient fund fees and interest for the payday loans are similar, the direct lender can do less to get you to repay your loan. This alone will make applying for a payday loan more attractive to those who want to protect their bank accounts as much as possible.
One drawback to using a direct lender of payday loans online is finding a responsible one you can trust. It takes doing some homework and talking to lenders in order to find one which lends with best practices. This is where banks and credit unions have the upper hand with better reputations in the financial world.
Consider all you options when trying to overcome financial crunches. Using payday loans online for fast money or heading to your bank directly have some risks involved. When you live paycheck to paycheck, you have to consider how the fast payoff will affect your budget. This aspect of short-term loans is often neglected when the search for fast cash is on. Payoff plans are important to think about before you take out the money. Create a plan to pay off your loan on time and create a back-up one just in case. Protect your bank accounts as best you can. Spend within your means and use the best sources for money help according to your financial situation.
