2022-12-04

Common Finance Terms

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Short-Term Loans for Immediate Financial Need

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During an emergency or an unexpected expense, your finances are greatly affected. They go beyond your savings, and most of the times, you might consider taking on a new debt for you to get by. One flexible option is a revolving credit from either a line of credit or from credit card but if you have an immediate need for a certain amount of money, applying for a short-term loan really makes sense.

Why people apply for short-term loans? Unlike other loans that are only intended for a specific reason, a short-term loan can provide an amount of money that can be used for various purposes. It could help provide funds for investments such as business or real estate purchase, for debt consolidation, home repairs, or health emergencies and other immediate needs that require money.

Where can you apply for a short-term loan? Various financial channels offer short-term loans. A qualified individual can get money quickly from banks, lending companies, credit unions and even through online lenders, with the help of this loan.

Types of Short-Term Loans

  • Cash Advance- this type of loan that is based on an existing card is the most convenient and the quickest way to acquire a specific amount of money. This enables you to withdraw cash against your credit limit through the use of your credit card. Remember that most cash advances have a high APR and cash advance fee, so make sure to use them for emergencies. Cash advances can also be acquired from the card issuer bank.
  • Personal Loan- This type of loan typically has lower interest rates than credit cards. It can help you make a big purchase or even consolidate high-interest debts. Application could be as fast as a few minutes only but processing and approval can take one business week.
  • Payday Loan- For as long as the borrower has a regular job, this type of loan is easy to obtain. The borrower must show proof of salary through pay slips. Usually, the term for payday loan is one month and the borrower has to pay a lump sum that includes the amount borrowed plus interest.

Short-term loans are the easiest and most convenient way to acquire funds for immediate needs. You can get the money right away without a lot of requirements from a lender. There is no need for collaterals or guarantors, too. This loan is easy to manage because you can pay it back quickly. The amount is relatively small but it is a great help in times of emergencies.

Short term loans are very popular nowadays amidst the financial crisis most nations are facing. This loan can take away some of the usual financial problems most people faces everyday such as daily expenses for food and transportation and monthly rents or mortgages and utilities. To anybody who would apply for this loan, make sure that the money you borrow, no matter how small, should go to the most important daily needs. Just because it is easy to pay, doesn’t mean you can just spend it with anything you wanted. The small amount of money will be all worth it, if you would think first of your financial goals and have an effective budget to follow.

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