Do you need extra liquidity and don’t know how to orient yourself in the request?
The first thing to do is to understand what are the financing instruments that banks and lenders can make available.
The reasons for requesting extra amounts of money can be different, from buying a new car to paying for your children’s studies at the University. These are extremely different needs which can be answered in different ways, specifically designed to meet customers.
First of all, we have seen here how to increase the chances of receiving the funding you need by following some essential measures.
Now let’s see what are some of the main resources to get the money you need quickly enough, for your different goals: payday loans, credit lines and credit cards.
payday loans and credit lines: what does it do for me?
If you are in doubt and do not know if, for your case, a payday loan or a credit line would be more suitable, keep in mind that there is, between the two, a fundamental difference: the payday loan provides a certain amount of money which must then be repaid over a period of time and with interest and installments of a pre-established amount, even if renegotiable, while a credit line can be renewed indefinitely.
In particular, moreover, payday loans without expense vouchers allow maximum freedom of use of the amount disbursed, while the targeted loans are linked to a specific purpose, including, for example, financing to purchase cars, computers or appliances of various kinds.
Credit lines: characteristics and advantages
A credit line is a sort of money reserve made available by the bank or credit institution chosen.
It works like a tank: a certain amount is decided which will be immediately available and must then be returned in accordance with agreed methods and interests. Activating and deactivating a credit line does not involve costs, so if you do not use it, you will not have any charges or obligations. This form of financing is useful if you frequently need not too high figures to meet certain expenses that occur over time. Also in this case, as for all requests for money, it is necessary to evaluate carefully whether it will be possible to cope with the repayment and if the activation of the credit line is compatible with one’s own risk profile.
Credit cards: how they work
Credit cards are also a form of financing: they allow you to make payments even when there is no liquidity on the current account because you can repay in about 30 days.
The refund of the sum, anticipated in this case by the card issuing institution, usually takes place in a single solution, unless a revolving credit card is requested, thanks to which it is possible to pay the refund in installments.
The credit card allows you to have a certain amount constantly available, regardless of whether it is actually available on our bank account. This is obviously very useful but it is necessary to pay attention and keep the costs under control in order not to risk not being able to cover the advance amount when it will be charged.
Loans, credit lines and credit cards: what should I choose?
There is no one-size-fits-all answer to this question: the choice, in fact, depends on your needs but also on your repayment possibilities, on your income, on whether you have fixed income or not.
A payday loan, for example, has the advantage of not reserving surprises: the amount is pre-established as well as the amount of the installments and interest.
A credit line, on the other hand, gives you the possibility of having liquidity always available, but usually it covers smaller amounts and the costs and interests depend essentially on the use or less of the money available.
The credit card, however, as we have seen, is recommended for those who have fixed income and know that, month after month, they will have no problem repaying the advance amount.