Many people choose fast payday loans because they offer fast solutions for borrowers with poor credit. While the vast majority of lenders will not approve borrowers with bad credit history, payday loans are one of the few options available that will approve their application.
The bulk of payday loan lenders approve borrowers within 15 to 20 minutes and the cash is usually in their bank accounts within the next business day. Although it might sound like an easy and convenient way to receive fast cash for emergency expenses there are a few draw backs.
Fast payday loans have three downfalls which include: small sums of cash, high interest rates, and tight time constraints. Many payday loan companies offer small sums of money amounting to a few hundred dollars, which in many cases may not be enough to cover your entire expense.
Along with that the high interest rates skyrocket the initial cost of what you have borrowed to double the amount you owe and in some instances triple. Then you have to deal with the time factor involved to pay back these costs, which is a maximum of 31 days. If you miss your payment due date for whatever reason add some more fees on to your bill.
Installment loans offer the convenience of a fast cash solution for borrowers with poor credit without the tight time constraints, may offer more cash to cover your entire expense, and lower interest rates. These loans have the option of being backed with collateral or without collateral and the loan term for repayment can be up to a year.
Especially if you have a more costly expense to take care of, installment loans are a more sensible option. You are more likely to get the full amount that you need, you are given a longer amount of time to pay it back, and the interest rates are not as high as fast payday loans.
