Friday, June 14, 2013

Are Short Term Loans Right For You?

During the present economic condition, it becomes often very difficult to meet up all your needs with the regular income. After all, you have to pay off all those medical bills, utility bills and education bills. Moreover, emergencies are always there and you have to arrange the money somehow. In situations like these, applying for traditional credits from banks or other financial organizations, doesn’t seem to be very feasible as the process is a bit time consuming and involves lots of formalities as well. 

As an alternative to these types of conventional loans, short term credits or cash advance loans happen to be popular options. Since you don’t need to provide a huge number of documents and the process, too, is completed within a short period of time, these financial alternatives seem to be popular way outs among people. Moreover, you can get approved for these credits even if your financial history is not-so-fair and if you have a bad credit score. However, while applying for such types of loans, you need to keep certain factors in mind –
· Do you really need the money? – The fact that there are plenty of financial alternatives available in the market and you can easily get approved for them nowhere means that you can apply for one every now and then. In fact, taking too much loans and then being unable to repay them within the given time will affect your credit status and gradually will lead you to a poor credit score. Hence, make sure you need the money desperately and then, apply for these loans. For example, if you want to go on a vacation, but can’t plan it due to lack of money, don’t apply for a short term loan. Remember, these credits should be applied for only for unexpected expenses that you have to pay off.

· Try to cut down the borrowing as much as possible – Make it a point to borrow as less as possible amount of money. This is important because these types of credits always involve high rates of interest and the more amounts you borrow, the greater amount of money you would have to pay to the lender.

· Shop around a bit before taking the loan from someone – These types of credits are available both online as well as with unconventional sources like personal lenders. You can even ask friends, family or someone from your acquaintances if they can lend you the money for a short period of time, probably till when you receive your next paycheck. While shopping online, check out the different sites – compare the rates of interest and other charges like application fees or processing fees. Check out if the lenders ask for an early repayment charges. Considering all these factors, choose the deal that suits your need best.

· Go through the Terms of Service carefully – Well, this is quite an obvious task before signing any kind of deal. But being in a hurry, you may miss out something very crucial. Make sure you understand all the terms and clauses perfectly before signing the agreement.

Author’s BioSam Payn is a well known blogger who has been associated with guest blogging for a number of years. He specializes in writing on topics related to finance, loan, insurance etc.

1 comment:

  1. Well, I think that short term loans can suit those people who need to fix financial problems urgently and have no one to apply to. Also these people should understand that short term unsecured loans have high interest rates and should be ready to pay off loans in time. Applying for hassle free money advance is easy and that’s why some people see it as the only way of dealing with emergency. Before taking out a loan you should consider alternative options and try to find a cheaper way out. Loan is a serious financial commitment and even if you need to fix your problem quickly you should consider all the pros and cons.


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