There are times when people require quick cash and going for traditional ways of getting a loan can be cumbersome. However, there are two fastest ways of getting an immediate loan which are title loans in Anaheim, CA, and payday loans. Both these loans are slightly similar that can help you get out of your difficult times. Title loans are offered based on the car value that you give as collateral whereas payday loans are based on creditworthiness.
Most people get confused between them as they don’t know about them thoroughly. However, the decision can be tough when choosing between them because they have their set of pros and cons.
Know about title loans
Instant Online Title Loans are known to be short-term loans that need your car as collateral. You can apply for title loans even if you have zero or poor credit scores. There is no compulsion of having a great credit score in this. However, there is a limit of 15-30 days to repay the loan amount. If you are able to repay the borrowed money then you can save your car. Otherwise, the lender will repossess your car.
The average interest rate on title loans is around 8% to 25% per month which makes an APR of 300%. This makes title loans high-interest loans. In comparison to other loan types, Title Loans in Anaheim are secured loans.
Know about payday loans
These are short-term unsecured loans that you can get on the same day. There is also a possibility of rolling over the loan. However, to apply for payday loans you need to offer some personal documents like income proof, bank account number, ID proof, etc.
With payday loans, you can get around $5000 and the APR reaches from 400% to 500%. In case you fail to repay the loan then you can get unexpected attention from collection companies which can affect your credit history.
Pros and cons of title loans and payday loans
Pros of title loans
- Immediate response – The instant online title loans in Anaheim offer immediate response and you can get a loan within a few hours as well.
- No credit check – There is no involvement in your credit history while getting title loans.
- Great amount – You can get around 50% of your car value.
Cons of title loans
- High-interest rate – The interest rate can be from 8% to 25% per month.
- Risk of losing a car – You have a higher risk of losing your car if failed to repay the loan.
Pros of payday loans
- Immediate response – You get an immediate response similar to title loans in Anaheim.
Cons of payday loans
- High-interest rate – There is an interest rate of 35% which is more than instant online title loans.
- Dealing with collection companies – If you are unable to repay the loan then it can affect your credit history.
After drawing a comparison between the two, it is better to say that both loans have their pros and cons. But title loans in Anaheim can be a better option than payday loans.