3 Common Kinds Of Short Terms Loans You Can Go ForFast Action Finance
People today are preoccupied with looking for different ways to get money as a result of the current poor economic climate that has hit and negatively affected them. Some opt to borrow money from some of their well off friends while others from different financial institutions around the country. The main problem with this is that they may or not get the financial assistance they may be looking for.
If you find yourself in dire need for immediate cash assistance, simply opt for short term loans offered by different financial service providers around the country. Here, we will be outlining some of the common short-term loan products you might want to opt for and their merits and demerits.
These are a kind of short term loans that can be availed to salaried people all over the country in need of them. So if you have some kind of a prove that you receive regular pay at scheduled durations within the year, these are your kinds of loans. Better still, if you have a bad credit score, you can still get a payday loan. Note however that these kinds of short terms loans are regulated differently in each state. The one thing you need to be aware of when it comes to these kinds of loans is that you can get yourself into a never ending cycle of increasing debt if you are not careful, particularly in their repayment. Before deciding to apply for these kinds of loans, ensure to review the following merits and demerits.
Payday loans are fairly easy to get approved for, with or without a credit report. This means that if you got a bad credit score, you can still get approved as all that is required is to show some form of identification and proof of income. In this regard, a few paystubs and a driver’s license is all that is required for the borrower to be approved. Once these have been availed to the lender and approved, the required loan amount is instantly transferred into the borrower’s account.
The main issues with these kind of short term loans is their high interest rates, their potential to trap the borrower into a cycle of never ending debt, especially if they fail to stick to the repayment schedule and hidden charges or fees, all that end up making the loan quite costly. For example, if you are unable to pay back the loan on time, the resultant penalty charges go up to $20 for every $100 that was originally borrowed. Each time a payment is missed, the loan gets more expensive.
Car title loans
These are some of the best short term loans for people with bad credit scores. In fact, they are one of the most affordable, safest and fastest ways to borrow urgently required money. The lenders allow borrowers to convert their vehicle’s equity into hard liquid cash. All that is required so as to avail this kind of a short term loan product is the car’s title, and a proof of regular income, in this case, a number of recent paystubs.
With car title loans, people can raise substantial amounts of money depending on their vehicle’s worth. Plus it is fairly easy to find out how much can be borrowed once the borrower’s application is received by the lender instead of waiting for days or weeks on end. Best of all, the borrower can raise the required amounts of money the same day without having to give up the use of his car. And as soon as the full amount that was loaned out is paid back, the title is instantly returned to the borrower and his commitment to the lender ended.
Line of credit
This is a great short term loan option for people who have variable expenses and income. It is also a great loan product for people that need additional capital to finance any number of projects or purchases.
The main merit of taking these kinds of short term loans is that they are open and quite flexible. When a person opens a line of credit, he or she is approved to borrow up to a certain limit, but not obligated to actually borrow the money. With a line of credit, you can always get the money any time it is required, for example when a disastrous situation such as unexpected medical expense, need to fix something on your car or house, loss of a job, etc, hits. Better still, when you decide to borrow money from your line of credit, you don’t have to borrow the full amount you are approved for. Unfortunately, people with a poor credit score can’t get approved for this kind of a loan product.
All in all, most of the short-term loan products are transferred instantly into the borrower’s personal account once approved. Apart from this, there is usually no need to check the borrower’s credit history or score when it comes to approving most of the short-term loan products in the market today. All that is required is a proof of identification and source of income for approval. And within a few minutes or hours, the borrowed money is instantly transferred into the borrower’s personal account for immediate use.