Payday loan lenders may have high interest, but credit cards have many more pitfalls to trap you into debt. Both are convenient to use. With a direct payday loan lender getting money deposited into your bank account is fast and a credit card fits nicely into your wallet to take with you everywhere you go. They both can help you salvage your bank account when your paycheck is still a few days away, with the credit card giving you continued usage over time. Spend the money, pay towards your debt and have more available balance to spend. It is an easy trap to fall into. Payday loan lenders lend money once per application. When you pay this debt back there is no reusing it unless you apply for a new payday loan. Not the best choice for you and clearly not a spending trap.
Payday loan lenders will not provide access to new cash as readily as a credit card.
Avoid falling into credit card debt traps. One of the biggest traps for spending more on cards is by using credit card checks. These checks can make payments by mail, pay off other debt, or used in any way that a regular check can be used. The difference being that the money spent is added to your credit debt and is charged a much higher interest than regular purchases.
There are often times credit card offers for special low rates in order to transfer other balances to their company. This is a great decision as long as you do not keep spending on the card. The low interest is only for a short period of time. Once the deadline arrives the balance is then applied to a higher interest rate. If you have made purchases on this card, than you defeated the purpose of transferring your debt. The goal is to pay down the balance, but the credit card trap is too inviting for many to spend more.
Another trap you may find yourself into is using your credit card at an ATM. The fast $100 here and there instead of using your checking account may not seem like a big deal. These withdrawals are charged interest rates of cash advances and could have fees attached to the ATM process. You are better off getting a loan from an online payday loan lender if you need an extra $100 before payday.
Some people fall into the rewards game trap. If I just spend this much more, I can qualify for this prize. Earning points and trading them in for rewards is all fun, but not when you spend just to get the reward. The purchases will build up your balance and will need to be paid off. Sometimes buying the reward on its own will be a less expensive venture than using credit card rewards point programs as an incentive.
Getting a credit card, using it and paying for it becomes so routine that one forgets to watch the small print. Credit card companies can use any reason or non-reason to raise your interest rate. They don’t even have to inform you of the change. The online payday loan lender will not change the interest rate on you. Everything you sign up for will remain the same. A credit card company will take advantage of the small print on your statement to let you know that your rates have changed.
You have to watch your credit card usage in order to stay on top of the game. They set traps and will continue to make offers to you in order to keep you using their card. Payday loan lenders may be available to those with poor credit but the loan amount is a one-time money transaction so additional spending will not keep purchases coming.
