Drowning in debt due to COVID-19? You’re not alone. The crisis has created the perfect credit card storm and TLC Loans is here to help you manage it.
While not everyone is getting physically sick from the Coronavirus, millions of Americans are feeling the financial impact. Hard. CreditCards.com released a study Monday morning showing the results of COVID-19 on our nations credit card debt. Nearly half (47%) of U.S. adults, or about 120 million people, currently have credit card debt, up from 43% in early March. Additionally, 23% of credit card debtors, or about 28 million U.S. adults, have added to their credit card debt as a direct result of the COVID-19 outbreak.
Even before the virus reached the US, many were already experiencing financial challenges. A study in 2019 revealed that almost half of respondents — 45% — said they have $0 in a savings account. Add to this of course, the massive collective credit card debt Americans have incurred and you’ll start to see the how it’s wreaking serious havoc on financial health. With this being said, we can see why individuals are stacking up debt fast, but that doesn’t mean you should be making your situation worse with unmanageable debt from a payday loan.
Dangers of Payday Loans
A payday loan may seem like the only option in a financial emergency like this, especially if you have poor credit and no savings. But it can do a LOT more harm than good – and there are definitely alternatives.
Taking out a payday loan means that the borrower falls short on cash before their next paycheck. The borrower is likely using a payday loan to cover an unexpected expense that costs more than the money they have on hand. This can happen to anybody.
Getting a payday loan is a quick way to get cash, but there is a huge catch: you’re paying extremely high interest rates as the finance charge can range from $10 to $30 for every $100 borrowed. A typical two-week payday loan with a $15 per $100 fee equates to an annual percentage rate (APR) of between 400% and 5,000%. If you’re unable to pay the money back on your next paycheck, you roll over your borrowings and incur more fees — making it easy to quickly wound up into spiraling debt.
Why Personal Loans are Better
The good news is there are so many options other than payday loans that don’t trap borrowers in never ending cycles of debt.
Unless you can qualify for a 0% intro period credit card, rates on personal loans are typically cheaper than those on credit cards, and the limits on how much you can borrow are usually higher. If you have high balances on multiple high-interest credit cards, a debt consolidation loan can roll your debts into one payment at a lower rate.
Further benefits of a personal installment loan include:
- Lower interest rates
- Uses for a variety of purchases (overdue bills, household goods, everyday living expenses etc)
- Consolidating high-interest debt
- A credit score boost
While a personal loan may be a good option if you’re in need of extra cash during the COVID crisis, there are many factors to consider before deciding what type of credit is best for your situation.
One of the most important factors is the amount of debt you put yourself in and making sure you feel comfortable that those are payments you can afford and making sure the loan is structured in a way that you don’t feel trapped.
Get a Loan without Leaving Home
To apply for a personal loan, first ensure your credit is as strong as possible. From there, explore lenders that offer personal loans with the features you’re looking for and gather the data you’ll need to submit an application.
At TLC Loans, our mission is to provide you with a solution that resolves or bridges your current troubles for an extended period of time and to provide you with a convenient and dependable source for additional cash whenever you need it! Pick up where the banks have abandoned you.
- We take pride in providing fast, friendly and compassionate service— so don’t hesitate to apply! All applications will be considered.
- Our installment loans are designed to match LIFE! TLC offers meaningful loan amounts and if you need it, we let you pay your loan back over a longer period of time so your payments are more affordable.
- Our interest rates are competitive and are a significant savings compared to PayDay rates.
- Our application process is simple with next business day funding possible if we get you an approval by 1pm CST.