paydayloanvstitleloan

We have all felt the pressure of too many bills and not enough money. Nowadays it seems as though the dollar bill just doesn’t stretch as far as it used to and in reality it doesn’t. Because of the stress we face each day trying to keep our heads above water, the idea of quick and fast dollars is becoming more popular. Thus began the market for 15-minute loans.

Two of the most popular loans available to those who need money fast and don’t have the credit to back them up are the title loan and the payday loan. These two financial entities are similar in structure they simply differ in what is being leaned.

A title loan is more often than not referred to as a car title loan or an auto title loan. There are many places to get a Title Loan in AZ. The title is self-explanatory. When agreeing to such a loan with a lender the borrower is agreeing to put the title of their car on lean until they repay the loan balance plus interest. If the borrower defaults on the loan, the lender can repossess their vehicle and sell it for the balance owed.

A payday loan is based on the same idea. However, instead of a lean on your vehicle you face a lean on your paycheck. The payday loan is also called a payday advance. The basic principle is that you are receiving an advance balance from your paycheck. This doesn’t have to be your entire paycheck it could just be a part of it. However, a payday advance accrues interest as well. This means that you will be paying back more than what was given you.

These two loans are basically the same. You are extended certain amount of cash based on what your wages. Even with a title loan the lender is going to look at whether you are employed or not and how much you make. You will be given a set amount of time in which to pay back the loan and you will be charged interest accordingly. Typically a payday loan is paid back on your next pay period.

These loans, while quick and easy to obtain can prove difficult to pay back and will affect your credit. However, as long as you are responsible with your payments and have made sure that you can afford the loan plus interest there won’t be a problem. In fact title loans are better than payday loans. They offer a greater pay period and larger loan amounts. You also don’t have to pay the full loan back in one payment. Usually these pay periods are stretched over a certain period of time.

It is important that a prospective borrower determine the necessity of the loan and the responsibility that it entails before signing any documents. These loans can prove useful under certain circumstances but they come with weighty responsibilities.

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