Not everyone that wants to take out a loan want to take it over a long term, and there are times when you may be looking for a shorter term loan to tide you over just for a matter of weeks rather than a loan that you are stuck with for twelve months or more.
If this is the case there is a solution available, and it doesn’t involve credit checks in most cases, so this type of loan is often accessible to more people given the number of consumers that have damaged credit these days. You will find a number of lenders that offer these loans, both on the high street and online, and for many people these shorter term loans can prove invaluable at times when money is tight.
Known as payday loans, these loans are available to those that are in employment and can therefore repay the loan from their salary. In order to qualify for a payday loan you will need to provide documentation to the lender to prove that you are in employment, such as a recent payslip, to prove your name and address details, such as a utility bill, and proof that you have a valid bank account, such as a recent bank statement. Without being able to provide these documents you will find it difficult to get the finance that you need. However, the good news is that there are no credit checks involved, so you won’t necessarily get rejected if you have poor credit as long as you meet the other eligibility requirements.
It is important to bear in mind the short term nature of these loans. They are designed to tide you over until payday, which means that in most cases you will have to repay the loan within twenty eight days of taking it out. However, some lenders will allow you to roll over part or all of the loan for another twenty eight days, although you will have to pay the interest charges again in order to do this. Most payday lenders charge a flat fee rate per £100 borrowed, and on average this works out to around £10 per £100. So, borrowing £300 would cost you £30 for the twenty eight day period, and if you wanted to roll over the whole loan for another twenty eight days you would pay another £30 to do this.
When it comes to loan amounts the amounts offered on payday loans are relatively low. The minimum and maximum borrowing limits can vary from one lender to another, but the limits are generally low, often set at a maximum loan of £800 or £1000. The actual loan that you will be eligible to borrow will depend on a number of factors, such as your income. When it comes to repayment of the loan you can do this in a couple of ways depending on the method used by the lender. Some lenders will ask for past dates cheques, which they will then bank on the repayment date. Others will ask you to set up a direct debit or standing order for repayment of the loan, which you can do directly through the bank.
These shorter term loans can prove useful in a range of situations, providing ideal as short term financial solutions for those that do not want to get into long term debt. These loans can come in useful to cover the cost of emergency repairs or unexpected bills that come in when cash is running short, and they can also prove useful at times such as Christmas when you may need some extra money to see you through the month.
Source:http://www.ukpersonalloanstore.co.uk/articles/112007/short-term-loan.html
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