People who have borrowed money from a payday lender often find themselves caught in a dangerous cycle of using payday loans to take care of their finances. Payday loans are usually for a few hundred dollars and used by borrowers to pay rent, a car payment, or other bills. These loans are short term and are given based on the borrower’s paycheck. The borrower is basically getting an advance on a future paycheck, which he or she signs over to the lender. When the borrower gets paid, he repays the loan amount plus a fee.
After using one payday loan to get out of a financial jam, it’s easy to get into the habit of using them over and over. The continued reliance upon and use of payday loans can lead one down a road of financial disaster. So, how can someone break this deadly cycle? With the right amount of knowledge and discipline, you can get out of the endless loop.
Many people who find themselves in debt and consistently using payday loans do not understand how credit cards work. A credit card can be used to pay for most anything. With a credit card, you do not need to pay for the items until the bill comes due. Credit card companies will allow you to make a minimum payment instead of paying the entire balance. Companies then charge interest on the balance remaining, increasing the amount that is owed. A mere $100 charge on a credit card can take several years to pay off by just paying the minimum balance.
Payday loans are often used to help cover minimum payments on credit cards as well as other expenses. Even though you are making a minimum payment, you are compounding your debt problem. Instead of relying on payday loans, consider an alternative – the car title loan. If you own a car, you can use it to borrow money and clean up your financial situation.
Embassy Loans is one of Florida’s leading consumer finance companies. Tens of thousands of customers have been helped by the company using car title loans. The process is very simple, and you can complete the entire process in as little as an hour. Your credit history does not matter either. You use your vehicle as collateral, but you can still use it while you pay off the loan. Interest rates are low, and you will likely repay the loan within 12 to 14 months. Use the loan to pay off your credit card debt or for other bills and fix your financial situation.