Credit cards can be beneficial when used appropriately, but there are pros and cons of credit cards like any other financial solution. A credit card can help when you do not have the cash available to pay for large, unexpected expenses. However, becoming too "spend happy" with them is a cause for concern; they can lead you into a seemingly never-ending downward debt spiral.

Before you decide to use a credit card for your financial emergencies, it's wise to explore all your options. At Carolina Title Loans, Inc., we urge you to carefully weigh the pros and cons of using a credit card for unexpected expenses.

What Are The Pros And Cons Of Credit Cards For Unexpected Expenses?

Using a credit card is a solution to paying urgent bills, such as medical expenses, auto and home repairs, or overdue bills. While credit cards can pay bills, they can also have significant drawbacks, such as high-interest rates. You must weigh the pros and cons of credit cards before using one for a significant expense.

The Pros Of Using A Credit Card For Unexpected Expenses

When urgent expenses arise, many Americans can struggle to take on the cost out-of-pocket. According to CNBC, most Americans could not afford an unexpected $1,000 charge. A solution for many is to use credit cards to pay for urgent bills. The advantages of using credit cards for emergency costs include the following:

• Purchase protection— You may have a problem with your purchase or the company you've bought a service/product from may have gone bankrupt. In these scenarios, you have buyer protection on your purchase when using a credit card. This means you can claim money back from your card provider if you have an issue with the product or service.
• Convenience— There's no denying that using credit cards is convenient during an emergency, particularly if you already have one. You don't need to waste time; simply use the card to pay for the crisis.
• Spreads the cost — If the unexpected cost is expensive, credit cards allow you to pay it over several months, releasing the financial strain on your budget. However, you must ensure that you make the repayments.
• Can boost credit your credit score — When you use a credit card responsibly, lenders know. As such, it can help enhance your credit score so you're approved for more favorable rates and terms in the future. You can even acquire a credit builder card designed to improve your score.
• Cashback rewards — Some providers offer rewards like cashback, air miles, or shopper loyalty points. You can apply these bonuses to future purchases to save money.
• Could have an interest-free period — Lots of cards offer 0% interest periods, allowing you to borrow for free as long as you make the minimum repayments. Before signing up for a credit card, you should look at the details to see how long you can use it without having to incur interest.

The Cons Of Using A Credit Card For Unexpected Expenses

Despite the advantages of using a credit card for unexpected expenses, some downsides can affect someone’s future finances. Americans who use credit cards for significant purchases and paying urgent bills must spend responsibly to avoid tanking their credit score and putting themselves into debt. The following are some of the cons of using credit cards for emergency expenses:

• Debt trap — Your debt can rack up quickly if you fail to make repayments. Those who use credit cards for large purchases who do not have a way to make repayments can be stuck paying off credit card debt for years after the fact.
• High-interest rates — Those with low credit scores may only qualify for credit cards with high-interest rates. That could mean your debt increases rapidly due to interest rates incurred while making repayments. If it takes months or years to repay your debt, you could incur thousands of dollars in interest that you have to pay off.
• Could damage your credit score — Miss just one payment on your card or let your debt rack up, and you'll damage your credit rating. A lowered credit score can affect your ability to borrow money, qualify for a credit card with better interest rates, or secure home and auto loans.
• Late fees — Credit card companies will put people who have to repay debt on a schedule to make repayments. If you fail to repay by the deadline, you can incur late fees that can add to your escalating debt.
• Confusing terms— Not all credit cards have the same terms; some include confusing details that you can only learn about if you read the fine print. You may not realize that some cards have immediate interest accrual or specific repayment terms.

What Financial Resources Can You Use For Unexpected Expenses Instead Of Credit Cards?

For some, credit cards' pros outweigh their cons. However, you can pursue other options if the cons are too great, particularly title and installment loans from Carolina Title Loans, Inc.

Potential borrowers should realize that these Carolina quick cash loans should only be used for financial emergencies. If an unexpected bill or expense comes up, an installment or title loan can help to pay for it. These urgent bills can include auto or home repairs, medical costs, emergency pet expenses, and unexpected travel costs.

What Are Carolina Installment Loans?

Otherwise known as a signature installment loan, this is an unsecured loan that allows you to borrow a specific amount of money and repay it over a predefined number of payments. Your signature guarantees the loan and solidifies your promise to repay it. 

You can get this type of loan from us by providing your driver's license (or a different type of state-issued identification), your most recent pay stub, and a checking account statement from an account in your name. If you qualify, people with all credit types can receive up to $1,500 for unexpected expenses the same or the next business day. 

How Can Carolina Title Loans Help With Unexpected Expenses?

Unlike installment loans, title loans are secured loans. We secure the loan by placing a lien on your vehicle title, allowing you to borrow between $601 and $15,000 to fund unexpected expenses like medical bills or veterinary fees.

Those wishing to qualify for a Carolina title loan must bring the required items to an in-person meeting. This includes your vehicle for an inspection, your lien-free title to your vehicle (in your name), and your state-issued identification.

Since online title loans use a car title as collateral, you don't need to have a great credit score to qualify, making it an option for those who own their vehicle outright but may have a damaged credit report. We also utilize the value of your vehicle to establish how much you can borrow. The more it's worth, the more you can borrow. You should only borrow an amount of money you feel you can repay.

What Is The Process For Seeking Carolina Title Loans And Installment Loans?

If you have unexpected expenses, an installment loan or title loan may be a better option for you than using a credit card. At Carolina Title Loans, Inc., we use a quick and fast process of seeing if you qualify to allow you to get money fast to pay for your unexpected expenses. The following are the steps you can follow to seek a Carolina installment loan or title loan:

• Fill out the online quick cash form on our website
• Speak to a loan representative over the phone
• Set up an in-person meeting
• Bring the required items to the in-person meeting
• Qualified individuals can sign the loan documents
• Receive quick cash the same or next business day

Fund Unexpected Expenses With Carolina Title Loans, Inc. Today

There are various pros and cons to credit cards for emergency expenses. Some people like the convenience, the ability to spread the cost, and the rewards. However, those cautious about the potential downsides, such as extra fees and high-interest rates, can seek a Carolina title loan or installment loan.

At Carolina Title Loans, Inc., you can benefit from our quick approval process to get the cash you need for your unexpected expenses. Fill out our online inquiry form or give us a call to get the process started today.

Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.