Payday Loans vs Title Loans

Payday Loans vs Title Loans

When you are in urgent need of money, taking a loan might be the best and easiest option. The nature of the loan you take can have a huge effect on your finances both in the short-term and long-term. Payday loans and title loans are popular choices for people who are in urgent need of a short-term loan. Understanding the nature of each will help you make an informed decision on which one you should choose.

Payday Loans

A payday loan is also referred to as a cash advance or a check loan. It is a short-term loan which is, in most cases, repayable within 14 days. When applying for a payday loan, you do not need to provide any type of collateral. Rather, you will repay your loan as soon as your next paycheck gets into your account.

Payday loans are normally approved and issued quickly regardless of your existing obligations or credit rating. However, you must provide evidence of employment to your creditor for the loan to be approved. Such could include bank statements that show a regular monthly income. You have to issue a postdated check for the full loan amount as well as the interest charged for your loan to be approved.

Once your loan is approved, the funds are deposited into your checking account. Payday loans are easy to apply for, and there are high chances of approval. You can also apply for fast payday loans online.

Title Loans

When it comes to title loans, you need to provide your car as collateral. This implies that your approved loan amount will depend on the value of your vehicle. For this reason, your vehicle will have to be appraised once you apply for the loan. The repayment terms depend on the loan amount, your creditor, and the terms on the contract. For instance, if you have borrowed only a small amount, you can repay it at once. In case of a huge loan amount, you can agree to repay it in installment.

Unlike payday loans, in a title loan, your vehicle will be repossessed if you fail to repay the loan in time. However, some creditors could rollover the repayment term and penalize you. You can use cars such as regular motor vehicles, trucks, semi-trucks, RVs, motorcycles, and so on. In most cases, you need to have paid off any financing on the vehicle. As is the case with payday loans, title loans are approved relatively fast.

Which One Should I take?

Each type of loan has its pros and cons. For instance, both come in handy in case you are facing an emergency as both have shorter approval times. Although you are risking losing your vehicle when it comes to title loans, they have lower interest rates. However, a payday loan would be suitable if the loan amount is equivalent to or lower than your weekly income.

Money 4 You Payday Loans in Utah and Idaho

Money 4 You Payday Loans understands that there are many different reasons you might need a helping hand to make it until your next payday. Give us a call at (801) 293-0865 to get cash today or Apply Online to see how our affordable short-term loans can help.

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