Online personal loans, sometimes referred to as online loans, are cash advances that an individual may apply for to meet a personal purpose. Unlike business loans, personal loans are small, short-term loans that are also termed general purpose loans.
There are multiple types of personal loans but the most common is the payday loan. This is a loan which a borrower pays back with his paycheck or salary.
- Two general classifications of loans:
Unsecured loans are cash advances that don’t have real claim on your income or assets. These are loans where the lender only relies on your creditability or trustworthiness as a borrower.
Secured loans are cash advances that rely on your cash flow or income and your assets. Real property is used as a collateral. Post-dated checks are also issued, which the lender can deposit to their accounts on the payment date.
I am sure you have already heard numerous stories about how a consumer had a hard time paying off his debts. How he really obtained financial freedom. How a borrower got buried deep in debts because of personal or payday loans. Contrary to these stories are tales from borrowers who were able to be financially free from debts.
May it be called online loans, personal loans or payday loans, always consider that loans are still debts. You can do something else to obtain that needed money aside from applying for a loan. Before you think about personal loans as a solution to your financial problems, there are other options that you could choose from. As much as possible, act as if you are not applicable to sign up for a loan. Make personal loans the option of very last resort.
Ask if your employer can give you a paycheck cash advance. This cash advance will be deducted on your next paycheck; much like a payday loan but you won’t have to pay for service charges or interest rates.
Analyze if you really need that loan. You might still be able to save enough to prevent you from loans. As an example, you need cash for you to be able to join your friends in a vacation. Is this a valid reason for you to apply for a personal loan? Don’t you think it would be better to skip that vacation until you have saved enough? It would be satisfying to go on vacation and have that hard earned money for you to spend on anything you like. At the least, you are not on vacation thinking that when you get back home, you have to face and pay the debts you acquired because of that short moment of pleasure.
You can also seek advice from family members. All you need to do is swallow your pride and ask. Nobody will give you a much sounder advice than your family. If you do not have other ideas on what to do, research on financial civic organizations or financial consultants in the area near your.
Personal loans can give you a positive or negative outcome depending on how you handle the money you have borrowed.