Lenders don’t want you to know this, but here are 3 reasons why CREDIT CARDS are BETTER THAN PAYDAY LOANS
Need money now? Many people who need fast cash are drawn to payday loans because they promise a loan with no credit check and no deposit.
While you can’t get a credit card with no credit check and no deposit, a credit card is still a much better choice in most cases.
Here are 3 reasons why credit cards are better than payday loans:
- Payday loans cost you more. A credit card may charge an APR of 35 percent or more if you have bad credit. But a typical payday loan APR can be eight times more: almost 400 percent, according to the U.S. Consumer Financial Protection Bureau.
- A payday lender can take your money. When you take out a payday loan, you may write a check dated for after your payday. If you don’t pay the loan before that date, the lender can cash the check and take your money. With a credit card, you have more control.
- A payday loan has no credit check. Yes, this sounds like a good thing. But a credit check helps a lender know if you can afford to pay back the loan. For this reason, a payday lender may lend more than you can afford to pay back.
It is definitely possible to get into financial trouble with a credit card. But a payday loan can cost you more and cause more financial problems. If you have a choice, it’s easy: go with a credit card to get the cash you need.