The short term loan
Short term loans are still a viable option for funding. Consumers with bad credit are definitely not alone. In today’s recession, even people with excellent credit have suffered at the hands of credit card companies. Others have made mistakes with credit, such as charging over limits or not paying their bills on time due to unemployment. Regardless of how they got there, consumers are suffering from a combination of bad decisions and the economic downturn. In addition, prices are high and many people have had to downsize to a one-income home as a result of the burgeoning unemployment rate. As a result of the economy many people watched their credit scores decline rapidly.
The good news is that a bad credit score or negative payment history does not have to hold people back from borrowing money needed for unforeseen expenses. Unsecured short term loans are a great option for qualified customers. Many people are looking to these types of loans for money, rather than the traditional bank loans that are difficult to procure in today’s recession.
How short term loans work
An unsecured short term loan lasts until qualified consumers’ application times and their next payday. This loan is also known as a payday loan, payday advance loan, or cash advance loan.
If qualified for this type of unsecured loan, consumers give lenders a postdated check in the amount that they qualified for plus fees. The lender holds the postdated check until the next payday, which is typically up to 30 days later. On the date the unsecured short term loan comes due, the lender will cash the check.
The most common use for short term loans is to meet emergency expenses. Car repairs, medical bills and last-minute shopping needs are all common uses for this type of funding. The general rule of thumb is that these loans are effective to use if the money for the expense will be available, but isn’t available yet. If a consumer will have the funds in a few days, or even a few weeks, but the bill needs to be paid immediately, then an unsecured short term loan may be the best option.
The amount borrowers qualify for is based on their current income. Depending on what the needs are, communication can be helpful. If the amount is substantial there are some lenders who will consider both incomes from a two-income household when considering the borrowing sum.
Popularity making short term loans more competitive
The advantage of short term loans is their popularity has spurred a wide variety of options. Because it’s paperless, appplicants know within minutes whether they qualify. This is another advantage of the short term loan.
With the uncertainty of the economy, short term loans are becoming a staple in budgeting for qualified consumers. They are quick, convenient and a life-saver for those who are eligible.