SHORT TERM LOANS:
SMALL DOLLAR BORROWING
It's no secret that payday loans are an easy route for borrowers with bad credit or no credit to get money quickly with no questions asked and no credit checks required. As useful as a payday loan is during the height of a budgetary crisis, these high interest loans with short terms can be financially destructive when mismanaged. A term extension or the borrower's inability to pay one month's bill can suddenly change the loan agreement causing roll over charges and an increase in the interest rate. The additional fees and charges can cause the loan's interest rate to grow higher than the loan's principal! Although all loans have penalties for late payments, a short term loan's terms aren't as disagreeable. With affordable rates and competitive terms, a short term loan gives borrowers speedy funding to pay for anything ranging from paying a cable bill to financing a trip out of town. Since a short term loan provides small amounts of cash in relatively short terms, these alternatives to payday loans are being called a smarter option than getting a payday loan.
For those debating whether getting a short term loan is the best financial solution, a few key components should be considered. First, a short term loan is not only for those with bad credit. As a matter of fact, fair credit and good credit borrowers utilize the benefits of short term loans just as often as those with poor credit. Secondly, these loans provide fast repayment terms and small dollar amounts. Sometimes people only need a couple hundred dollars and would rather take out a small loan. When borrowers request more than they need, they can accidentally end up buying more than they can afford which can lead to repayment troubles. If these conditions match your needs, then a short term loan may be just what you want.
Most Common Questions about Payday Loan Alternatives
What is a payday loan?
A payday loan is a small dollar loan that allows borrowers to obtain cash on short notice. Sometimes, these loans are referred to as "short term loans," as the loans are usually for a short duration (until the borrower's next payday).
What are payday loan alternatives?
A payday loan alternative is an online loan option for millions of consumers who need to get fast access to cash before their next payday.
As a borrower with bad credit, can I get a payday loan alternative?
Borrowers with bad credit can apply for a short term loan. The interest rates and terms will vary depending on your credit score.