Kash Avena
We’ve all been there before — cash-strapped, with a mailbox full of unpaid bills that our paycheck is too small to cover. Whether it be due to an unexpected trip to the doctor, a tuition fee hike, or just the ever-rising cost of living in the Philippines, not having an emergency fund can wreck havoc to already shaky finances. You may want to consider getting a loan to keep you afloat in this time of need. The thing is, not all loans are created equal
This is especially alarming when you consider that only 69% of Filipinos have a bank account, according to a study by the World Bank called ‘Global Findex Database’ back in 2014. What’s more, according to this study, more than 10% of us get loans from informal private lenders.
There is nothing wrong in taking a loan to get out of a financial rut. In fact, if done correctly it can be a lifeline that allows you to get back on your feet financially. However, getting the wrong loan from the wrong, opportunistic lender such as loan sharks can be devastating. One such potentially harmful loan is the Payday Loan.
Payday Loans are small amount, unsecured loans that have a short term – usually until the borrower’s next payday (thus the name). Aside from the loan amount, the borrower has to pay a finance charge, which is usually a fixed amount. To avail of a payday loan, the borrower also has to issue a post-dated check (PDC). So what’s the problem with Payday Loans? It creates a cycle of debt by having a short term to maturity, coupled with a high cost of borrowing.
Not to be confused with Payday Loans, Personal Loans are different. While also a type of unsecured loan (meaning there is no property put up for collateral such as a house or a car), Personal Loans qualify borrowers based on their credit score and history and capacity to pay. Meanwhile Payday Loans can possibly bait people who do not have the means to pay their loans on time, or at all. Furthermore, Personal Loans have a minimum payment term of 12 months, giving the borrower enough time to pay the debt off and recuperate financially.
Need a Fast Loan Option?
If you have a good credit standing (meaning you don’t have a loan that has been left unpaid for a while) and have a steady source of income, you can get a fair deal by applying for a Personal Loan. You can check out Loansolutions.ph, the largest network of legitimate lenders in the Philippines.The Loan Concierges from Loansolutions.ph can help you make the smart move by finding the banks and lending companies with the best rates that you qualify for. All you need to do is answer their 3-Step Loan Application Form, and you’ll learn your possible loan options in as fast as 3 minutes.
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