Bank loans vs payday loans

It is increasingly common that more people need to resort to some type of loan to acquire money. There are several acquisition methods, but certain differences need to be clear before making a decision.

If you are in this situation, take some time to consider two of the most common options to avail a loan, and not fall into hasty conclusions.

What suits you, take out a bank loan or ask for a payday loan?

What suits you, take out a bank loan or ask for a personal loan?

  • payday loan

It is an agreement between two parties, a lender and a borrower, through which the first lends a fixed Good Finance amount to the second, which undertakes to return it within a stipulated period, either once, or in several installments.

This agreement usually carries interest for the money borrowed, which is usually a percentage of the total money borrowed, and is usually paid in the form of regular installments.

  • Bank Loan or Credit

It is a financial aid service that consists of the entity making available to the beneficiary a maximum amount so that he can dispose of it as he needs it.

In this way, the interests are higher, since it is a Good Finance amount that you can have at your disposal at any time.

One of the most common ways to access a credit is through the credit card, a tool to be able to have money that we do not have in exchange for paying interest proportional to the amount used.

Main differences between bank loans and payday loans

Main differences between bank loans and personal loans

Renewal credits are also granted for a term, but unlike payday loans, when it is terminated it can be renewed or extended.

They cover different needs, the credits are more useful to cover mismatches between collections and payments, or to face temporary periods of lack of liquidity. Therefore, loans are usually more suitable for companies than for individuals. payday loans are usually granted to finance the acquisition of a particular good or service.

Interest in the case of credit, a specific interest is paid which corresponds to a percentage of the money we use at a specific time. With the payday loan, we only pay an interest rate, proportional to the money we borrowed at the time of the agreement, and are paid regularly until the money is returned.

Paperwork and waiting times to apply for a loan you must attend a bank in person, bring all the necessary documentation, and have a clean file.

To apply for a quick payday loan, you can do it with simple steps through the internet and without complex paperwork. In 15 minutes you can have the money in your account, after the lender confirms your solvency to face the repayment of the loan.

What loan suits me best?

What loan suits me best?

The use of one service or another really depends on the needs. It is not that one is more convenient than another, they are completely different products.

Advantage Credits

  1. You can renew and expand it as many times as you need.
  2. You can dispose of the money in cases of emergency.
  3. You can buy whatever you want or need.
  • Disadvantages
  1. It has a high interest rate.
  2. The deadline for payment is short.
  3. It has processing and administration expenses.
  4. If you fall behind on a payment, your credit history will be affected.
  • Loans
  1. They offer a low interest rate.
  2. They can lend large amounts Good Finance.
  3. It is not necessary to specify what you will use the money for.
  4. From the beginning of the loan you know how much you will have to pay.
  • Disadvantages
  1. You cannot renew them. If your loan is due you must make a new application.
  2. The interest rate changes according to market indices.
  3. In some cases they charge a high commission for making an advance payment.

We hope you find the article useful and we invite you to quote your loan on our website, Good Finance.

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