Payday Advance or Collateral Loan
A payday loan is usually conducted at a loan agency and there are many of them located around cities everywhere. Recently there has been a increase in the number of online payday loans available to the public also. However, the fees and interest rates are usually very high, and there is no collateral trade involved. Another aspect to consider, is that your next paycheck acts as security for the loan, and can end up placing the borrower in the same scenario again, playing a never ending game of catch up.

Collateral loan customers pledge property as collateral, and in return, the pawnbrokers offer the cash loan. After customers pay back the loan, their merchandise is returned to them. Pawn loans are made on everything from jewelry to electronics. However, if the customer chooses not to redeem his or her collateral, there is no credit consequence to the borrower.

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