It used to be that the only way to get a loan was to go to a bank, present your financial details, and hopefully get approved. With strict eligibility requirements and a long underwriting process, getting access to cash was often a struggle for the average person and nearly impossible for anyone with less than stellar credit or no assets. Today, however, there are several ways to apply and get approved for a short-term loan.
There are thousands of private lenders willing to work with borrowers to get the funds they need – and fast. A quick online search would allow you to check out advance loan options available to you. For those who have never applied for a short-term loan, however, deciding which is the best option may present a challenge. As not all loans are created equally, here are some factors to consider when deciding which short-term loan is best for you.
- Lender reputation – unfortunately, there are a lot of scams and unprofessional lenders out there looking to con you out of your money. Before applying anywhere you should make sure that you check the validity and reputation of a particular lender. You can check places like consumer review sites and the Better Business Bureau to make sure the lender you’re considering is legit and recommended by others.
- Interest Rates – When you borrow money you’ll be required to pay it back with interest. This interest can range from just a few bucks to several hundred dollars. So, as you review short-term loan options make sure that you compare the interest rates to get the lowest offer.
- Additional Fees – Depending on the lender you choose there are other fees that could be tacked on. For instance, some lenders require you to pay an extension fee if you don’t repay the loan in full on the day it’s due. This fee does not count towards your loan balance or interest and essentially means more money lost on your behalf. Before agreeing to borrow the funds, don’t be afraid to ask the lender about additional fees.
- Repayment Options – It is imperative that whatever loan you accept that you have the means to pay it back on time. Installment loans, for example, might give you 3-6 months to pay back your loan in full while a payday loan requires their balance in full within 14 days. Before signing any agreements, make sure that you can commit to the repayment options set before you. Once you agree, whether you can afford to or not you will be obligated to repay or face consequences that can include additional fees, collection actions, and even wage garnishment.
It’s awesome and convenient that if you need to borrow a small sum of cash quickly that you can do so by applying for an online cash advance or short-term loan. However, before making a commitment and signing on the dotted line, it is imperative that you do your homework to make sure that both the lender and the loan you’ve chosen is legit and reasonable. Using the factors listed above will assist you in selecting a lending option that is most convenient and affordable for you.