Facing financial problems can have a knock-on effect on your mentality, and especially your self-esteem. It can be demoralizing and devaluing to feel like you are not in control of your financial independence. Worst of all, you are powerless to change your circumstances. Right?
Short-term loans can provide short-term answers to get you out of an uncomfortable financial situation, easily and quickly and recent research by Peachy found that 71% of short-term loan borrowers take on average 3 short-term loans in their lifetime with 8 out of 10 borrowers happy to recommend the lender to family member or friend.
Here are some of the reasons why you can take out a short-term loan with head held high and a clear conscience, all the while knowing you’re making a positive difference in your life.
1. Poor Credit Rating
If you have a poor credit rating, the chances are, banks will not approve a loan deal. Short-term loans can be an effective alternative when banks refuse to put up the money due to credit rating issues.
However, having a poor credit rating does not necessarily mean you are bad with money – in fact, in order to achieve a good credit rating, you must prove that you can pay your way out of debt. This means that those who have never been in debt their entire lives can still have a poor credit rating, since they have not shown their ability to pay it off.
2. Improve Credit Ratings
As mentioned above, in order to achieve a good credit rating, you must show that you can get yourself out of debt, which of course first means that you have gone into the red. If you take out a short-term loan and pay it back before or on the deadline, you are demonstrating your capability to manage your finances responsibly and pay back loans and debts.
As such, you can expect to see your credit rating rise from a successfully paid-off short-term loan.
3. Disaster can Happen to Anyone
If you don’t have an emergency savings fund and disaster strikes, you are going to need money from somewhere. Unforeseen circumstances such as accident, injury or damage to your house, car or other assets will demand that you have access to money and provide it quickly, through absolutely no fault of your own.
Again, banks can often take time to provide such funds, or, worse will refuse to provide them at all. A short-term loan can get the money to your account within minutes of being approved. Short-term loans also work to get you a decision on your approval as soon as possible, usually making payment on the very same day as the application was submitted. This ensures that you can get the money you need and get yourself back on your feet in the timeliest manner possible.
4. Viable Alternative to Accruing Fees
If you have a series of repayments coming up and know you will not be able to make some or all of them, a short-term loan can provide exactly the quick burst of cash injection that you need to avoid accruing fees and penalties. Fees are lost money, since they are not part of the debt and not even part of the interest!
One short-term loan can push back the dreaded payment date, thus avoiding fees and giving you some breathing space. Of course, you must make sure that you can pay back the short-term loan in the timescale provided; otherwise you will be simply replacing one problem with another.
5. Often Simpler and More Transparent
Loans from banks and other sources of credit can often entail a lot of small print, which normally includes a lot of hidden fees. With a short-term loan, typically what you see is what you get. All transfer fees and other costs are included in the fixed quote you are given when applying for the loan, which means there are no nasty surprises further down the road.
Simply decide how much you want to borrow and for how long and the online calculator will inform you how much is to be repaid, and in how many installments, if you choose the multiple repayment option.
6. Everything in Moderation
Just like everything else in life, short-term loans should only be used in moderation. If you need a quick lump sum to fix that gaping hole in your bedroom ceiling, change the exhaust on your car or meet those upcoming mortgage payments, then a short-term loan could be the way to go. They shouldn’t be regularly relied upon – however, when used properly, they are an incredibly effective and shame-free tool for helping with temporary cash-flow problems.
7. Goodbye Shame. Hello to Prompt Payment
As long as you have done your research and know your own circumstances, there are absolutely no problems to taking out a short-term loan. They are easy to use, offering clearly defined terms and involving no hidden fees, and can be arranged online, over the phone or through the mail.
A decision will be taken about your eligibility quickly, using the information provided to determine whether or not you are a suitable candidate. If approved, the funds will be transferred as soon as possible (normally within 15 minutes), and when it comes to repaying, you don’t have to do anything!
The amount will simply be automatically withdrawn from your bank account, making the whole process a simple, smooth transaction.
Short-term loans provide an excellent service for those need money quickly and without hassle. As long as you are confident you will be able to meet the repayments in good time and in full, the loan could even have the added boon of improving your credit rating.
Far from being shameful, you should even be proud of your ability to pay back the loan in the time allotted.
Do you agree with our view of short-term loans? Let us know in the comments below.