Whenever you’re preparing to take a loan, well you’ll have certain big decisions to make. One of them is the length of the term loan. It can be just as important as the amount of money in the loan and its interest rates. In fact, there are various types of loans out there, which can baffle you a bit. But one such loan which is pretty popular is undoubtedly the short term cash loans.
As the name suggests a small cash loan is generally taken for a short period of time, primarily to meet the demands of the uncertain expenditures. Usually, short term loans provide finance for the duration that suits your repaying ability and personal circumstance. So, if you want a loan that allows you to pay it back in shorter duration, a short term loan is the great idea to go with.
These are certain key benefits of short term loans for the borrowers:
1. Availability of Quick Cash
Do you know when an uncertain circumstance is going to occur? No right. Emergencies are simply the part of life that can come up anytime. Nothing stays the same ever. Sometimes things can even go wrong.
But what to do when such situations come in your way? It’s true when things go wrong, you may not be in the best place to financially or mentally deal with the situation. Hence, a short term cash loan can be your aid. It can offer a bit of hope and relief to the situation as you can easily get the cash. The application process is hassle-free and quick. And with the right lender, you can have the amount of money you need in no time.
2. Time Period
The first thing which separates the short term loan from other loans is the period for which it is taken. Basically, this loan is taken for a period of less than a year. Sometimes it is even for less than 120 days. And when it comes to paying off the interest, well the basic concept of interest is that it is added on the loan you have taken. Since, the short term loan is paid off quickly, or at least quicker than the long term loans, there is less time for the interest to build up and it significantly results in less interest accumulation.
3. A Rapid Boost to your Credit Score
Paying off a short term loan on time or early has always been a great way to raise your credit score. In fact, the results are almost immediate. We all know that a better credit score helps to open up other doors as well. With a good credit score, you can get better loan opportunities and much more.
4. Faster Than Banks
There is no specific criterion to take a short term loan. Many people need this loan for different types of emergencies. This type of loan usually does not require a long and drawn-out approval process. If approved, in most of the cases you can receive the funds on the very same day. In fact, short term cash loan doesn’t require any credit check as when compared to banks.
Well, no doubt benefits are important to know before you step ahead to take a short term loan, but from where you can get it? Here is the list of sources to get a short term loan when in need of quick cash.
Sources to Get a Short Term Loan
Banks are one of the most common sources to get a short term loan, but wait a minute; do you have a good credit score? If you’re planning to take your loan from banks, there are certain criteria that should be followed mandatorily. A good credit score, a track record that gives the lender assurance in you, & security are certain factors to consider while taking a loan from the bank. In fact, the terms and conditions of every bank vary from the other. So make sure, you know the bank and its rules before you move forward to take a short term loan.
2. Pawn Shop
Basically, pawn shops offer simple, collateralized loans to the borrowers. If you want to get quick cash and are having poor credit history, it doesn’t mean that you cannot get a short term loan. There is a great option available to you is by taking a cash fast loan from the pawn shops.
Taking a short term loan from the pawnbrokers helps you to fulfil your fund scarcity. So, if you have any valuable asset, pawnshop allows you to loan against any asset that you own. It is true, due to bad credit score, many people experience loan rejection, but with pawn brokers, you’re completely assured. No matter you’re having a good or bad credit history, you can get quick cash on the very same day by just keeping your valuables as security.
3. Venture Capitalist
A group of professional people that helps in providing funds to the scarce is known as the venture capitalists. They are considered as the investors who either provide capital to the startup ventures or supports small companies that wish to expand but have a scarcity of funds. Considering them as a source of getting a short term loan is not at all wrong because they help in providing funds but again, you need to give them certain security that is viable under their conduct.
Hence, a short term loan is flexible, can be repaid in short span of duration, & easy availability of cash that can help to finance a smaller amount of debt easily. Know more about short term business loans here.
Here’s an infographic to make you understand the concept in a better way.