Personal Loan or Payday Loan: How to choose?
There is an emergency, you need a financial loan now! But which one to choose? There are several types of loans that are available to you. Know the differences between personal loan, private loan and payday loan. Determine which of these three solutions best corresponds to your expectations.
What is personal loan?
Personal loan is a regular loan that can help you finance a major purchase as well as pay interest on your credit card or process an unexpected medical or family emergency. The latter is usually issued by banks or financial institutions. The sum of the loan will vary, depending on the case in question. For example, Desjardins Bank can lend you more than $ 12,500.
The main advantages of the personal loan are:
- The app to get it is easy to have, however, a credit check is often done prior to its approval.
- Obtaining high sums subsequently refundable by installments (if necessary)
- The planning of the payment dates is fixed in advance. This allows the debtor to be organized for his repayments.
- Repayment of this type of loan is unlikely to affect your finances
Nevertheless, to obtain a personal loan you must have a good credit rating ie, a high score in your credit report, which will reflect your financial responsibility to define whether or not lenders can trust you.
What is the private loan?
Private lending can also be a solution; it is a financial tool just like a bank loan except that it is governed by creditors belonging to a private domain (they are neither banks nor financial institutions). The value of the loan amounts may be lower than the personal loan but higher than the payday loan. So expect the borrowing of medium sums.
The private loan will quickly seduce people with a bad credit check or bad credit because it usually does not require any history. In addition to this loan is made confidentially, if you meet certain conditions. As a result, an obligated creditor will be in tandem with the debtor in order to best benefit him, according to his requests.
What is the payday loan?
The payday loan is a form of private loan. The first criterion to be fulfilled is that to obtain it one must hold a job. This is because the payday loan repayment is based (as the name indicates) on your salary. This must be done on the first day of your next payday, it’s a short-term loan. The payday loan is a benefit to some, as it is an urgent money loan, it does not require audit performed beforehand as the approval is made the same day of the application.
In conclusion, the choice of your loan will be, according to your profile. The personal loan and payday loan can be good financial help, but before choosing it, you have to be aware of its characteristics.
Once your repayments are made, try to organize your future expenses effectively so you do not fall back into serious money problems.
As the saying goes, “any problem has its solution”, that’s why we’re here to help you out. We guide you to make the right choices. Contact us for advice from our creditors.