Advantages of the payday loan over the pawn shop | Brand Voices

It is more profitable to get a payday loan online than to seek help from a pawn shop.

There can only be two sensible reasons for taking out a payday loan online. First, when you invest that money in something that will repay the cost of the loan many times over. The second is the beginning of a type of force majeure the consequences of which you cannot overcome without a payday loan.

Unfortunately, even very organized and financially disciplined people are not protected from elementary mistakes, accidents and strokes of fate. Together with our experts, we decided what to do when a small amount of money is unexpectedly and urgently needed. It is more profitable to get a payday loan online than to seek help from a pawn shop.

Loan in the pawn shop advantages and disadvantages

It is firmly anchored in our psychology that only people in hopeless situations turn to pawn shops. Lying in heirlooms or work laptop: what can be worse? It is still worth thinking about an online payday loan.

Working with a pawn shop can be mutually beneficial. Of course, subject to all conditions for a loan including a payday loan online. The first and foremost advantage of pawn shops is that they do not require a certificate of solvency, as can be the case when obtaining a payday loan from a bank without registration or even without an identification code. In addition, with the help of a. even charge a title loan Title loan calculator at MoneyZapif you need a loan for a very short time. To get money, it is enough to show a liquid deposit and some form of identification: an internal passport, driver’s license, international passport, military ID or any other document that shows your full name. There must be a photo and a signature with the seal of the official who issued this document.

The second benefit is speed. No credit committees! Everything is decided directly in the pawn shop. They will tell you right away whether they are giving it or not, and if so, how much. Then the customer makes the decision. After all, the cost of “pawn shop” money is quite high: from 0.3% to 1.5% per day. That is 109.5-547.5% per year. For comparison, even the most expensive pre-payday bank loans cost 60-80% per year. Still, it will hardly be possible to get a one-year loan in a pawn shop.

The average repayment period for these financial institutions is around a month. The maximum repayment period for taking out a payday loan is approximately 3 months. It is only offered by large pawnbroker chains.

Great promise in the pawn shop

In most cases, pawn shops will accept jewelry, silverware, and gold bars as collateral. When it comes to simple gold products or bars, most pawn shops will tell you directly on their websites how much money they are willing to give for the security of 1 gram of “yellow” metal. Over the course of the year, that number has increased by several dollars. If you’re looking to misplace an exquisite gem-studded piece of jewelry, don’t expect a fair price for it. Pawn shops are not yet allowed to sell jewelry, only hand them in as scrap.

Therefore, they are rated accordingly by weight. Problems can also arise when laying objects made of platinum, diamonds and emeralds. Many pawn shops simply don’t have appraisers (usually in large network pawn shops). If there is still an appraiser in the pawn shop, you can get 50-70% of its value on the security of the jewelry. This is because the gemstone market is somewhat limited. Hence, it can be difficult to sell them on to pawn shops. In this case, the online payday loan wins.

Payday Loans Online Or Pawn Shop?

Many people have found themselves in a situation where money is needed within a few hours more than once. It is good to have relatives or friends who are by your side at all times and lend you money “until payday”. If it’s not about you, you’ll find yourself in a similar situation every time. You have to look for a lender in order to take one Payday Loans Online.

Some of the most popular lenders are pawn shops and microfinance organizations that can lend you money or a payday loan. The conditions for taking out a loan in these organizations are fundamentally different. Therefore, before making a choice, you should carefully weigh the pros and cons of both lenders when taking out an online payday loan.

Loan in a Pawn Shop: What’s the catch?

A pawn shop is an agency that provides loans that are secured by real estate. This property is the main disadvantage of pawn shops. To get a loan, you need to give something valuable (even temporarily). The following can serve as collateral:

– valuable jewelry;

– valuable metals in bars;

– valuable stones;

– collector coins, weapons;

– Awards made from valuable alloys;

– Domestic appliances.

You also need to entrust your property to someone you don’t know. Its value should exceed the loan amount by at least a third. In some cases, the rated value of the collateral must be twice the borrowed value. Few people are satisfied with such conditions. Other people are increasingly opting for microfinance organizations and receiving online payday loans at more favorable terms.

Advantages of microcredit

Microfinance Organizations (MFOs) are companies that provide loans to borrowers without the need to provide collateral. Such companies appeared in the credit market relatively recently, but they were able to rightly gain popularity. Microfinance organizations work according to a simplified scheme. To apply for a payday loan online, it is enough to fill out a form that consists of simple fields. By taking out a payday loan with an MFI, you can get money with any bank card. Most of the MFIs give a loan within 10-30 minutes. You don’t have to leave your own home to get money as payday loan services process applications online.

There is another benefit of applying for a payday loan with an MFI. If it is not possible to pay the debt on time, you can “negotiate” with the MFI. Most pawn shops do not go to the ceremony in the event of a late debt settlement and put the property up for sale immediately. Microfinance organizations offer the option of postponing the payment or extending the term, taking into account the current situation of the borrower. At the same time, the MFI can raise the lending rate, but you won’t lose your property and you can return the money as soon as you have it.

The main advantages of MFOs over pawn shops can be formulated as follows:

– no deposit required;

– the simplest lending system;

– efficiency of application processing;

– the ability to take out a loan from home;

– a more loyal attitude towards the borrower.

Taking out a payday loan online is more lucrative and convenient than giving away a valuable piece of jewelry, equipment or an award from your grandfather to a “strange uncle”. MFI transfers money to any card within half an hour and does not require confirmation of the borrower’s solvency. What could be simpler?

About the author:

Frank Glemstone – Frank is a graduate of the Master’s degree in Economics. He has written numerous articles on personal finance and wealth. As the lead author for MoneyZap, he now works with clients across the country helping them achieve their financial and life goals.

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