Home Blog Credit Cards vs. Personal Loans: Which Is Better For You?
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Person cutting up their credit cards once and for all in favor of personal loans

When large bills like holiday shopping, car payments, home renovations, or new furniture come into the picture, you need a way to spread your payment. Credit cards and personal loans each offer access to a pool of money, unlocking purchase power that you can repay over time. Knowing which option is best for you will help you spend wisely. 

How Does a Credit Card Work?

A credit card is a way to spend money now and pay it back later. You can use your credit card to complete any purchase within a predetermined limit and then repay what you owe over time. Your credit card provider will assign a minimum monthly payment, which you can stick to, but your balance will grow as it builds interest. You can also choose to pay off your entire balance at once or pay more than your monthly minimum.

How Does a Personal Loan Work?

A personal loan is a borrowing option that provides you a certain amount of money and a specific amount of time to repay it. You can use all of the money at once toward a large purchase and then make monthly payments. The payment structure is similar to a credit card, but the interest rate is almost always lower. The key difference is that you request a loan amount up front and you receive only what the lender will give you. 

Should I Use a Credit Card or a Personal Loan?

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Credit cards and personal loans each have benefits and drawbacks. The right choice for you depends on your situation. However, personal loans give you many of the same benefits as credit cards while adding safety measures that protect your financial well-being. Here's why you should choose a personal loan over a credit card. 

Revolving Debt

 A credit card gives you revolving debt — you enter a cycle of accumulating debt, paying it off, and building it back again. The debt comes with a high and sometimes variable interest rate.


A personal loan prevents overspending by allowing you to borrow a set amount that covers exactly what you need — end of story. A credit card might tempt you to push up to your credit limit and further into debt. A personal loan's limits make it far easier to budget for on a monthly basis.

Credit Concerns 

Your current credit score impacts your ability to obtain a credit card or loan differently.

If you do have bad credit, you may never qualify for a credit card in the first place. Or, if you do, your monthly credit limit might be low while your interest rates are exorbitantly high. 

Personal loans from Atlas Credit, however, don't depend on your credit score. Even if you have bad credit, you can qualify for a loan of up to $1,400 from Atlas Credit and pay it off in five to 12 months. 

You also can improve your credit by making consistent monthly payments on the personal loan. When your credit score rises, you can qualify to borrow larger amounts of money in the future. You may get approved for a vehicle loan or a mortgage, making personal loans more desirable for their long-term impact.

Large Purchases

Think about what you want to purchase with your money. Are you making one large purchase or multiple small purchases? If you need to buy a few small items at different stores, then it makes sense to use a credit card versus a personal loan. But when you want to get a bigger-ticket item, such as a hot tub or a cutting-edge gaming console, then you should choose a personal loan over a credit card that will rack up interest at a higher rate.

You can pay for your large purchase using a personal loan taken out for this purpose. You will receive a more favorable interest rate than on a credit card, meaning you will pay less in the long run for the item.

Access to Cash

You can get cash from your credit card, but that comes with a sky-high interest rate. If you need cash quickly, a loan is better than potentially getting into credit card debt. At Atlas Credit, you can sometimes get your money on the same day you apply for the loan.

Why Trust Us to Compare Personal Loans and Credit Cards? 

We work with customers every day who are looking for ways to navigate their financial situations. Just like you, our customers know what they need — fast access to liquid money — and recognize the options in front of them. We dedicate time with our clients to discuss their options. Between a loan or a credit card, a personal loan is consistently a solution.

We've also built a personal loan product and see its positive impact regularly. Offering a competitive personal loan has helped us see the inner workings of a beneficial loan and how they compare to options like credit cards.  

Ultimately, your financial well-being is what matters to us most. Our mission is to spread empowering financial information and connect people like you with a roadmap toward a more secure future. Whether you're discovering us for the first time or you are a long-time customer, you can trust Atlas Credit to point you in the right direction. 

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Experience the Benefits of Personal Loans With Atlas Credit

Atlas Credit offers a fast, easy way to connect you with cash. You can apply for a personal loan online or at your nearby Atlas Credit location. We can get you situated with a great personal loan to help you get back on track — and you can forget all about adding another piece of plastic to your wallet.

We invite you to learn more about our loans online to see how you can qualify for a personal loan.

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