Unsecured Personal Loans vs. Payday Loans

Differences Between Unsecured Personal Loans & Payday Loans

 

Unsecured Personal Loans

Their loan balances, and repayment histories are reported to the credit bureaus.Timely payments will positively contribute to the borrower’s credit history and score.

Several factors determine the annual percentage rates (APR) for unsecured personal loans: borrower’s credit, employment history, loan amount, and the lender’s loan programs.

Payday Loans

Payday Loan are usually very short-term loans that have to be repaid within two weeks.Their loan amounts and repayment histories are not reported to credit bureaus.

The average APR for payday loans is between 360% and 400% – approximately $15 to $30 for every $100 borrowed.