Cash loans are often considered as quick money and the name “cash” comes from that in most cases it is cash that the customer gets to use. Cash is not often given to the person’s hand, but instead it is send to the bank account of the customers, where the customer can withdraw the money as cash. There are many versions of cash loan, so the way the customer receives the money, varies. Cash loans are often also very small amounts, 50$ – 2000 $, so the amount of the loan is one of the biggest difference to personal loan.
Interest rate is another main difference between cash loan and personal loan. In personal loans the interest rate can be set to very low, as customers need to pay back a big loan sum for long period of time. Whereas cash loans are small amounts and often also much more risky for the debtor. Some people who don’t have a credit score to be able to get personal loan, can however get a cash loan. In cash loans the interest rate higher, because the debtors also carry a higher risk for customer not to be able to pay the loan back, at least in that has been set to the contract of the loan.
A short list of the differences between a cash loan and a personal loan
- interest rate
- risk level
- amount of loan
- the way the money is received
It is advisable always to think twice before applying for cash loan, since the interest that you need to pay, can be higher than what you are ready to pay. In cash loans are often also other costs (which nowadays can’t be hidden anymore, thanks for law changes). Other costs can be for example maintaining the account, setting up the loan, making the changes to the loan and other. If you are looking for low interest loan, it is recommended to take a personal loan and not a cash loan. Because the banks have a lot competition of the customers nowadays, they are put compete with the interest rates as well. At the same time as they make the whole customer experience better, they also lower the interest rates. Interest rates are however not only decided by the banks, but also the current economical situation in America and all around the world affects the interest rates. World is global, so the changes in China’s economy can affect what interest rate Americans are set to pay.