Every time one is thinking of applying for a loan, there are a few major decisions that one needs to make first. The length of the term is as just as significant as the amount one is applying for as well as the interest rate. Assume there are two loans with similar principal size, the loan with the shortest time will charge higher interest rates compared to the one with a long term. Large monthly instalments seem like a dissuading and intimidating characteristic for a short term loan. However, this should not make people shy away from them, short term loans can without doubt be a really good alternative for your unexpected financial needs. Here are reasons why short term loans are great;
Less Interest
The longer you owe money the more and more interest gets added to your balance. However with short term loans one can pay back everything quickly and since there will be less time for the interest to accumulate you will end up repaying the money with less interest.
Lower Interest Rates
Not all loans have lower interest rates. For instance loans taken without guarantor or collateral or over a long period of time normally have higher interest rates. However short term loans tend to have lower interest rates. This means you will save money both due to the lower rates and on the short time period that the interest doesn’t accumulate.
Predictable
It is difficult to tell how your finances would be in the future as no one knows for sure how the economy might turn out to be in 30 or 40 years to come. Unlike getting a long term loan which you’ll still be responsible for into the future in spite of how your finances might be, short term loans are much easier to budget for as they are predictable.
Not Stressful
Owning someone money long term takes an emotional and psychological toll on someone as interest accrues with time. However with short term loans, your debts will be paid back much faster freeing you from that burden.
Boosts Credit Score
Getting a short term loans and repaying it back quickly on time is a good strategy for boosting your credit score much faster.
No Collateral
However some short term loans require collateral, generally it is not a major consideration when applying for short term loans.
Quick Cash
Short term loans normally take less time to process as compared to traditional loans. Hence if you need quick money, short term loans might be the answer for you.
At cash carrot, they understand when opportunity knocks you have to answer and that is why they have designed easy and flexible short term loans to enable you get money quickly when you need it. In fact, since most of their short term loan application are made online, you can secure a loan that best suits your needs and receive the money in munities upon approval. Their services are available 24/7 and even money can be deposited to your account on weekends. Don’t let yourself stress and cash carrot is here for you!