Short term loans can help you with the unexpected money issues and are basically designed with temporarily money problems. So should you consider short term loans to, let’s say, get your vehicle smogged, leakage fixed or a purchase made when you are low on cash? Definitely, yes. But this is where you should stay sharp. In this article we’ll focus on the basics of borrowing in projection on short-term loans.
The interest rates range in short-term loans is mostly much higher than that in the long-term. So you should always keep in mind that the price to pay would be very different from that you’ve might have seen in installment or mortgage loan offers. However, the short-term loan is cheaper in the long-run, given the fact that it is used not frequently (that’s why these types of loans are typically capped by 30 days limit).
The common features of short term loans are:
Short term loans imply a variety of advantages too. Let’s focus on the main ones:
In short term loans even the basic factors (such as permanent residence at one address or property ownership) greatly increase the chances of a positive decision on your loan, that’s why you may almost always consider this opportunity. The same logic applies when analyzing the customer’s credit history. Not every company do credit checks, but those who do reward the potential borrowers with lower rates if credit score is OK.
All and all the penalties for short-term loans are typically less severe as with the repayment of the mortgage loans. And the payment delay for several days might be considered to be a technical delay with little or even no penalties if you notify the lender. The most radical measures, an appeal to the court, is used by the bankers only in case of 3+ months delays as practice shows.