Wednesday, August 9, 2017

Online Lending vs. Credit Cards – Get the Real Truth

Online Lending vs. Credit Cards – Get the Real Truth


Getting extra cash is not that difficult these days. There are plenty of people and businesses that exist solely to get you to borrow money so that they can make money from you. As a consumer and borrower, you have to be knowledgeable about what your options are, how they stack up to one another, and what makes the most sense for you. One of the biggest battles is between online lending and credit cards. Here’s the final answer on which is better.

Convenience – Online Lending Ties with Credit Cards


Both of these financing options are convenient for borrowers, and that is important. With so many choices for getting extra cash, ease of use is a must have. With credit cards you simply apply, usually through the mail or online, wait to get your card, and then once you have it, just swipe away to spend. With online lending, you go online or use an app, apply, and get cash sent to your account by the next morning for the utmost convenience.

Good Debt – Online Lending Wins


One very important way in which online lending beats credit cards is the type of debt it gives you. There is such a thing as good debt and bad debt. Credit card debt is bad debt because it never goes away. Credit card companies aim to keep you in debt indefinitely to make more on interest charges. With online lending, you get a small loan that you repay in a week or two. You are left debt-free again, and paying it back on time actually helps your credit score.

Avoiding Overspending – Online Lending Wins Again


Another issue with credit cards is that when you spend with plastic, you tend to overspend. There is a psychological element to this that has been proven: when you can’t see the cash, you spend more. With online lending, you get actual cash that you can see and spend. You also have a finite amount of cash that you have borrowed, unlike with a credit card, so you can budget it and spend it as you intended, without going overboard.

Safety – Online Lending Takes the Cake


All those paper applications for credit cards that you get in the mail are a leading way that people open credit cards in another person’s name. It happens all the time, but not with online lending. There is no paper trail because everything is done online with the best encryption software for protection. Online lending is truly safe with a reputable lending service because there is no paper for someone to pick up and misuse, and your information stays with your lender only. No one else gets access to it.

The options for borrowing money are not likely to be limited any time soon. If anything you will be given more options in the future. Understand those options, how they will impact you and your finances, and then make a smart choice, like online lending.

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