Seeking to apply for a short term loan and in a dilemma as to whether you should go for it or not? Do not worry as life is a total summation of the choices we make and at times we simply need to be pointed in the right direction. Short term loans have indeed helped numerous people get the much needed financial help as and when they need it within a couple of hours. If you are wondering why you need to consider applying for short term loans, we are going to highlight some of the top benefits of applying for them.
Quick access to cash
The outstanding benefit about short term loans has to do with the fact that you get access to the cash you need within a very short period of time. Usually, once your short-term loan has been approved, you can expect to receive the cash mostly within 24 hours. This type of loan is, therefore, instrumental when you are in urgent need of cash in a hurry.
Leniency regarding your credit history
Your credit history plays a central role especially when you are applying for a long term loan. However, short term loans do not dwell so much on your credit history and tend to be lenient when it comes to it. In other words, you can get approved for a short-term loan provided that you have a steady income and free from any other outstanding loans.
Short term loans are mostly unsecured which essentially means that you do not have to pledge security prior to approval. You can, in essence, get approved for a short term loan without having to set up any of your assets as security. What this really mean is that should you default, none of your assets will be at risk. However, you shouldn’t apply for a short term loan with that kind of mentality. It is essential that you meet your loan obligations as lenders can utilize other mechanisms to ensure that they recoup their money when you default in payments.
The beautiful thing about short term loans is that there are many lenders there out willing and ready to work out a flexible arrangement when it comes to repayment. For instance, you can choose to be paying off the interest accrued to the loan monthly and ultimately pay the principal amount as a one-off payment. This flexibility is indeed what attracts many people to short term loans.
No long term commitments
The drawback about long-term loans has to do with the fact that you have to be committed for a prolonged period of time usually lasting a couple of years. The same cannot be said about short term loans as you are just committed to a loan for a couple of months only and ultimately focus on the foreseeable future.
To sum it up, in as much as there are many benefits related to short term loans, there are also a few demerits which include high-interest rates and the fact that defaults lead to high penalties and fees.