Can Personal Payday Loans Help You Get Out Of Major Debt?

Are you exploring your options for overcoming debt once and for all?

Navigating the world of personal loans, payday loans, and other borrowing options can be stressful, especially when the whole motivation behind it is to get out of debt.

That said, as counterintuitive as it sounds, taking on a personal loan can be a great option to pay down lots of your debt at once, especially if you have accumulated several high-interest loans.

Personal payday loans can also be helpful when you are in a bind and need to make end’s meet. These are usually small loans that don’t require a credit check, but proof of income.

Read on to learn what the best option might be to pay off your debt using personal loans and payday loans.

Use Loans to Strategically Pay Down Debt

The most important part of any debt repayment plan is to avoid making rash decisions, whenever this is possible. Often times, these can land you in more trouble than you were in the first place.

Take your time in creating a plan, but don’t delay the strategizing. The longer you wait, the more interest you are ultimately paying.

The Pro’s and Con’s of Personal Payday Loans

Personal payday loans have their place and time, especially for instances of dire need. These can be a lifeline when you are in over your head and can’t pay the bills.

Typically, they involve a cash advance on your paycheck, in which you bring proof of income to the loan office.

You will generally have to provide them with access to your bank account in case you default on the loan, but they do not usually require a credit check. This can be a breath of fresh air if your credit is less than excellent.

That said, while personal payday loans provide a quick out for immediate expenses that couldn’t be paid otherwise, they are not generally a good option for repaying large sums of debt.

Alternatives to Payday Loans

The best option generally for paying down debt is a personal loan, rather than a payday loan.

Personal loans will typically require a credit check, though some do not, they have significantly lower interest rates than payday loans.

With a personal loan, you can get between $1,000 and $50,000, if approved, and receive a 6 to 35% interest rate. Payday loans range in value, but the average is around $500, and between $15 and $30 is charged from every $100.

But, personal loans can be a long process because they involve more vetting. You may also need a co-signer to be approved.

However, all considered, they are still generally a better option than a payday loan, because payday loans can get you locked into a vicious cycle.

If you are already locked into that cycle, consider applying for a good personal loan can help you get out of the payday loan cycle entirely.

Conquer Debt for Good

Though a personal loan is a good option for consolidating debt such as high-interest credit cards and loans, it is in your best interest to create a plan to defeat debt for good.

Here are a few ways you can start that ball rolling, on top of consolidating debt with a low-interest loan.

  1. Look for Opportunities to Save

Be ruthless in your pursuit of savings, whether it be cutting the cable, unsubscribing from unused services, or obsessively couponing. Use those savings to pay down as much as possible.

  1. Talk to a Debt Counselor 

If you are up to your eyeballs in debt, the best option is usually to speak to a professional debt counselor. They can help you identify all of your debt, and create a game plan for paying it all off.

  1. Start a Side Hustle

Finally, if you are struggling to get debt down with your current income, try to pursue a side hustle that’s income will entirely go towards debt payment. From mowing lawns to pet sitting, there are ample options for anti-debt side hustles.

Emerge Debt Free with a Personal Loan

Overall, using a personal loan instead of a personal payday loan is the best course of action for most people looking to get out of debt.

Payday loans are more designed for short-term needs, such as bills or unforeseen expenses. Personal loans are generally larger, and allow you to consolidate your debt much more easily.

Ready to make some big changes in your finances? Check out our article on how to get going on your 2019 resolutions today.

 

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