personal loans credit card financing.

While credit cards are a popular way to finance the purchase, the truth is that they are an expensive way to finance the purchase. Interest rates charged by credit card can double the price of personal loans. Sometimes, even the rates charged for bad credit personal loans is below the rate of credit card receivables.

In addition, the interest rate is not the only reason why credit cards can be expensive. Credit cards tend to boost consumption. As they only have to pay the minimum payment is generally made up solely of interest, you think you can keep your costs so that you can afford the monthly payments. But finally, the accumulated debt will be very costly.

Credit card financing

credit card financing is usually the first choice for people who make a purchase. The use of a credit card to solve the problem of having to carry large sums of money or having to write checks that are not as immediate. Financing credit card is like a line of credit is associated only with a plastic card that provides immediate access to funds from around the world through a global network.

With the use of a credit card, you can buy a product as a whole and determine the amount to fund each month when their balance credit card comes with the option to pay the same minimum amount required for interest and only a small part of the principal or to obtain financing of some stores that agree to charge small fees with an interest rate calculated as the sum of monthly payments. Each month, the store charges your credit card with the parties before the product is fully paid.

Benefits of credit card

The main advantage of the credit card offers is its flexibility. In addition to the simple and practical offered by eliminating the need to carry cash or checking account number and remember and as such, it is widely accepted in almost all purchases in hundreds of countries.

Addition, when the balance on your credit card, it is not necessary to pay the full amount you can pay a percentage (at least the minimum payment required) and finance the rest. Next balance of the credit card will have the outstanding balance of the previous month and new purchases that you made during the month.

Personal loans benefits

However, the interest rate charged by credit cards are high. It can sometimes reach 20% which is very expensive. Some consider these charges as unfair. And when you can pay only the minimum amount required, May you feel tempted to do so, leading to the accumulation of debt, which is a widespread problem among American consumers.

personal loans, however, provide a single sum to buy what they need on a fixed interest rate and significantly lower (between 8% and 15% of normal), with reasonable certainty that Monthly payments are fixed. This allows you to budget their expenses and have more control over their costs, thus avoiding the accumulation of debt can lead to poor time credit.