How to get a good deal on a short term loan?

Follow these basics to ensure you get the best deal possible.

09:46 22 April 2013

Finances are on everyone’s mind as news reveals that the UK’s credit rating has dropped from its previous AAA standard. While this is largely applicable to their international borrowing power, the reality is that effects of this are felt throughout society.

 

Those struggling with loan repayments, or who have been unemployed have felt the effects of the economy for a while, and some have turned to short term loans to get over financial hurdles.

 

Short term loans make it possible for those facing sudden financial risks or other issues to obtain money with little notice. Many of these loans have high interest rates, so here are a few ways to get the best possible deal on short term loans.

 

• Shop around—it’s probably redundant, but just like anything else competition is important. Don’t just take the first loan you’re offered. Ask for interest rates, and make sure you understand the repayment terms as well.

 

• Check all options—there are different types of short term loans, although many people automatically think of short term loans as payday loans. Some financial institutions will actually give loans at much better rates for a short period of time. Keep in mind that if you need the cash fast, they may not be able to process the paperwork as quickly as you need, so be sure to ask how quickly it can be done if time is an important factor.

 

• Search online—don’t forget about this resource when comparing rates and terms. You may find a considerably better deal online than what you may have locally.

 

• Penalties—avoid short term loans that assess penalties if you pay more than the amount due, or if you pay it off sooner than the expected date. Also check on the process in case you ever struggle to make repayments and what your options would be.