Have you ever faced instant cash needs? You must have encountered such situations at least once in a lifetime. Perhaps you require cash to fix the dripping roof. Or you may need it to clear the credit card payment. You cannot wait until payday to fix it. Here, short-term loans may help. These are quick cash facilities to counter such emergencies.
It helps you get cash before the salary day and fix the issues. Moreover, you don’t need good credit to qualify! The blog briefly discusses the basics of short-term loans and their benefits. Read ahead to acknowledge cash emergencies better.
How would you describe short-term loans?
Short-term loans are an instant cash facility for individuals needing money immediately. It is an unsecured loan with a maximum repayment period of 12 months. It is also known as a payday loan because it helps fix needs before the income day.
The interest rates and monthly instalment amount remain fixed. Individuals applying for the loan don’t require a good credit score to qualify. Instead, you may get it by revealing a lengthy and consistent employment history. The loan providers may demand proof of income and bank statements for assessment.
What are the types of short-term loans?
A short-term loan comes in multiple forms. It may differ according to your personal or business-specific purposes. The most common types of short-term loans in Ireland are – no guarantor loans, text loans, payday loans or bad credit loans. Let’s understand these loans in detail:
- No guarantor loans
These are short-term loans that one may seek to finance a need independently. If you don’t want to add someone to the loan or want a private agreement, a no-guarantor loan may help. You require a decent credit history and regular income to qualify. It helps you get the cash help of up to €10000.
- Text-loans
It is a loan that you may get over text without internet requirements. Text loans are a popular short-term loan to consider in Ireland. You can contact the firm by choosing to get a loan through text. Select the options that the company sends you as text messages. You get the cash deposited in the respective account.
- Bad credit loans
A short-term loan is a form of bad credit loan. Under this, individuals lacking decent credit scores or pending payments get better interest rates. Moreover, one can consider bad credit loans for high cash flexibility. For example- you may consider it to finance home renovation for poor credit scores.
How does a short-term loan work?
Short-term loans are designed to help you get the money in an emergency. It is the best facility to tap before the payday. Individuals apply for short-term loans by providing basic details. The loan provider tallies the details with the proof you provide. Generally, the expert requires Identity proof, salary slip and bank statements.
This evidence helps the loan company analyse the borrower’s potential to repay. Accordingly, they decide and release the amount. You don’t need to be specific with the answer generally. Most legal direct lenders don’t ask the purpose. However, avoid claiming one for illegal purposes.
You must repay the amount according to the loan agreement dates. You can set direct debits or budget manually. It is easier to budget as the monthly amount remains the same. However, don’t miss the payment. It increases the liability.
Here is a brief and easy short-term loan example to help you understand it better.
For example- you need £3000 instantly to fix the leaking pipe. However, you lack the lump sum right now. You may have insignificant savings that may not help you. At the same time, you cannot wait until the salary credits. Here, you search for the best short-term loan in the UK marketplace. You compare the interest, APR and other costs before applying. Provide the details so you can place your form for approval. The lender, on the other hand, receives it and asks for proof of income.
Your payments may look like this:
- Amount to borrow- £3000
- Loan term- £12 months
- Monthly repayment- £269.31
- APR (Annual Percentage Rate)- 14.9%
- Total repayable amount- £3231.72
Note- Always compare the APR% rate before applying. Choose the vendor offering the loan at the lowest APR.
What are the advantages of short-term financing facilities?
There are multiple advantages to getting a short-term loan. You get it the same day without detailed documentation. It is a small loan and does not require much proof. Here are other benefits of short-term loans to consider:
1. Small repayment period
As mentioned above, you can settle the loan dues within 12 months. Choosing the repayment period depends on income, monthly savings and liabilities. It helps you get rid of the debt quickly. If you struggle to define the ideal time to pay, take an expert’s assistance. It is ideal for individuals facing uncertain financial challenges or income.
2. Helps build credit score
Yes, a small loan may help you improve your credit score. Short-term financial facilities usually share competitive interest rates. It means you pay more if you skip the monthly repayment. However, ensuring regular and timely payments reduces the liability. It optimises your credit utilisation limit and boosts your credit score. Improved ratings may help you fetch better rates for credit cards.
3. Flexibility to get the cash on doors
Yes, only a few loan providers offer the facility to deliver the cash at home. Search for the leading private money lenders in Ireland that offer this option. It saves time and is easier for persons lacking a bank account or internet connection.
In this, the lender’s representative may land up at your doors to provide the cash. They confirm the requirement and assessment before approval. Keep the documents ready for quick processing.
4. Does not require a guarantor or collateral
Qualifying for the short-term loan does not require a guarantor or pledging an asset. Thus, the loan removes the hassle of finding the person you can rely on. Instead, you are solely responsible for the payments. Secondly, with no collateral involved, you can avoid the worries of losing your precious belongings. What could be better than fixing cash lows without worries?
Bottom line
Short-term loans are an instant financial facility for individuals needing emergency cash. It is an unsecured loan with a small cash payout. It is sufficient to cover up your critical requirements. You may qualify if you meet the provider’s eligibility criteria. Generally, individuals with consistent income, balanced finances and trusted details may qualify. Check it out to meet any of your needs on the same day!
