The beauty of a short-term loan is that it’s far less hassle than all other types of loans available in the market.
The last thing that anyone needs when all they need is a little extra money unexpected, are mounds of paperwork and red tape.
It’s true, generally, you won’t have a credit check performed on your credit profile when you apply for this handy little loan. You can apply through almost every lender since larger banking providers, as well as other registered lenders, cater to this product. They’re really simple to find as well! They’re mostly all available to you online through innovative technology, which has become extremely convenient in today’s hustle bustle life.
Unplanned emergencies, desires and needs can crop up at any time for any type of individual and there’s no reason why we should not have access to any help in the interim before we’re able to comfortably repay. Short-term loans have assisted thousands upon thousands of individuals in South Africa with these short, fuss-free loans and making lives a little more bearable in those tough situations.
They’re designed to meet your short-term needs in terms of your lifestyle, your affordability and your urgency. Which is great, since that’s all anyone ever needs when in a pickle! Always be wary though when applying for a loan, that you understand all that is involved. It pays to know all there is to know when you’re about to borrow money.
How does a short-term loan work?
As the term states, it’s a “short” term loan, therefore you would typically be borrowing a small amount of money from the lender of choice. Each lender will have a minimum and a maximum that you can borrow as far as their short-term loan offers are concerned. When it comes to repaying the loan, the terms over which you can repay the instalment monthly are anything from 2 weeks to a few months. This will all largely depend on the agreement that has been drawn up between the institution lending you the money and yourself.
There is an interest rate attached to the loan that will also differ from lender to lender. Hence it is best to shop around and ensure that you are choosing the best deal available to suit the amount of money and term you require.
Most companies have online loan applications or handy sliding scale tools on their website where you can simply drag the bar across to stipulate your needs. As you do so, you’ll notice that the instalment amount changes and will end up reflecting the amount that you would be expected to pay back monthly.
It’s not all about you, you know? The lenders also need a few things! Since it’s legal and since it involves cash, they would need to cover their bases too. They’ll need all your personal information, so it’s best to have it handy. As with most contractual agreements, it would be your bank statements, recent payslips, proof of residence and a valid South African ID.
As soon as everything is verified on the lenders’ side, they will correspond with you immediately to advise you on whether the loan’s been approved or not.
How does the application process work?
You can apply in store, however, it is obviously recommended to do it online simply to save you time, money and hassle. Online applications are known to be completed and submitted within minutes! This is a major benefit to someone who needs a short-term loan, as the needs are typically more urgent than with long-term personal loans. Thankfully to the new technology we experience every day, we are exposed to the convenience of instant gratification. Once you submit your online application and upload your supporting documents, you can simply sit back, relax and wait for someone to contact you.
If everything checks out and there are no further queries relating to the information you provided, or otherwise affordability concerns based on your documents, you can expect to receive the funds for your short-term loan within 24 hours!
You will provide a valid bank account through which a debit order would be created on the lender’s side. You will also agree upon a debit order date so that the repayments can be deducted from your account smoothly and without any possibility of defaulting on the account.
One of the major benefits of short-term loans is that there is seldom ever a credit check performed on your credit profile. They will assess your income and expenditure and if they can see that you have sufficient disposable income to repay the loan, they will approve it. That means that if you are blacklisted or need a personal loan for bad credit after being rejected for a bank loan, you can also apply for this loan for your financial status won’t impact their decision.
Are these loans expensive?
It’s all relative to what you can afford, but the truth is that they are more expensive than a longer-term loan. The reason for this is that it’s a shorter loan, which means higher interest rates! The reason for the higher interest rate is due to the lack of security required on these loans. They’re designed to meet a short-term need that you can ideally afford, but need access to the money in a lump sum upfront before repaying.
When should I apply for a short-term loan?
The only time one should really apply for a short-term loan is in an emergency. For any other reason, it would always be recommended that you choose a tailored long-term loan to suit the needs of the financial requirement. The reason for this is simple – it’s going to cost you more money! If you can afford the higher interest rate and don’t like the idea of long-term debt, then sure, it’s still a great option. But it’s tailored to meet short-term needs, therefore it’s best to understand why you are applying in the first place.
If your car breaks down, or you have an unexpected medical bill, perhaps sadly someone has passed away in the family and there was no funeral cover. These are all emergency requirements that you only need in the short-term and are good reasons for taking out this type of quick cash loan.
The one thing to take into consideration, emergency or not, is whether you can afford to repay the instalment amount each month. Since lending institutions don’t perform credit checks, it’s only you who will truly know whether you have enough money each month to repay your loan. Don’t kid yourself either, because if you haven’t budgeted correctly and default on a payment, it can be far more implicating to default on a loan, than if you just defaulted on the account that you needed money for in the first place.
Life is expensive and often we have no idea when something is going to cost us more than what we originally forecasted in our minds. That is why short-term loans were designed as products for all individuals in this country – to give a little breathing room and lend a helping hand to get us through the unforeseen time that has landed at our doors. For simple, efficient, instant cash loans that are confidential and will give you a reason to feel some relief, these loans are for you.