A Car Loan May be a Better Option than a Credit Card

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By Jacob Maslow

If you have a credit card, you can probably get a cash advance through your card. There are limitation though, and if you are in a hurry for your money, getting a car loan might be a better deal.  If you own your car, you can get money fast, even if you don’t have great credit by using a title loan.

It is easy to fall into credit card debt, and with high interest rates on credit cards, you may have trouble getting out of debt. Credit cards are best used for short term purchases that you can pay off at the end of the month.  A big purchase can also be workable with a credit card, but just be aware that you will be paying a higher interest rate.

A car loan is essentially a personal loan, and you are putting up your car as collateral. You still have your car and can drive it, but if the worst happens and you can’t pay off your loan, the finance company can get their money through your car. It is risky in a sense, but if you have a job and are bringing in money, it should not be a problem to pay off.

If you don’t have credit, or have bad credit, you may not even be able to get a credit card.  This is one of the advantages of a car loan. In addition to getting the short term money you need, you can build up some credit. Some people have even gotten loans for the single purpose of building up their credit score.

With a car loan, you are putting up the title, so that cancels out your need for good credit.  If you have bad credit, or no credit, you can begin to change your score with a car title loan from Title Loans Fort Lauderdale.

Credit cards are notorious for high interest rates. If you cannot pay it off each month, you will be paying a high interest rate. A title loan is a personal loan that is secured. These typically have lower interest rates.  You may also use a personal loan to consolidate your debts.

Ultimately you should want to raise your credit score. Both credit cards and personal loans are considered on credit scores, and they are considered different types of credit. Most people with good scores have some history of debt with both types of financing. The key is to pay your loan off regularly, and make each payment on time, to make your score as good as possible.

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