The economy of the country in the uncertain situation that it is then many financial experts are recommending that people only use their credit cards when absolutely necessary. While these financial experts have a good idea, the reality of the situation is that the average working person often accumulates more bills than they are able to handle easily. And as any homeowner knows, it seems as though when one thing goes wrong, two or three other things go wrong at the exact same time. This can leave a person feeling extremely stressed and worried about handling their bills. One way to handle unexpected bills is with a payday loan.
What Is It?
This type of funding is very unique because it basically allows you to borrow money that you have not yet earned. Let’s say, for instance, that you get paid on a bimonthly schedule. Almost everyone enjoys getting a large check every two weeks, but what happens if the money gets spent before your next paycheck is due? That is what payday loans are all about. This type of borrowing allows you to get the money that you need in order to pay for an emergency situation extremely quickly. Once you then receive your next paycheck you pay back the money that was borrowed, with interest, and you are all set.
This is vastly different from a credit card because with credit cards the repayment plan is specifically designed to last as long as the company can make it last. That is because the longer it takes you to pay off the debt you charged, the more interest the credit card company earns. The repayment plan for a payday loan is much more simple and concrete and allows you to repay the money that you used immediately so that there is no lingering debt.
Why Not Borrow From a Bank?
Many people wonder why you should look to payday loans rather than to borrow money from a bank. Yes, you can borrow money from your local bank and set up a repayment plan fairly easily, but what most people don’t realize is that you actually have to tell the bank what you plan on using the money for before they are going to lend it to you. This can be an embarrassing, and potentially sticky situation to be in depending upon why you need to have the money in a hurry. When you take an advance on your paycheck, however, there are no questions asked and you can use the money however you would like to. Many people find that this type of borrowing is better suited for emergency situations than any other.