Loans Reasons short term loans are more beneficial

Augusta

VIP Contributor
Loans are money collected in bulk to do a thing or two that are really demanding at a time. It is good to go for a little loan that paying back with be a lot easier and short term loans does it better. They come with the below benefits

No need for collateral, so you don't need to worry about presenting any asset

Processing for short term loan is quick. So you would be able to meet up with your demand very fast too

It comes with little interest rate so pay back is a lot easy without having to stress self during repayment

It can boost one's credit worthiness. As you pay up quickly, getting a bigger loans will be a lot easy.

What do you think?
 

Mika

VIP Contributor
Unless you are borrowing from a private lender or from micro-lending institutions, you need collateral for your loan. Who told you short term loan does not require collateral? The only exceptions to this are micro-lending financial institutions and private lenders. However, I do agree that loan processing time is quick.
 
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btaliat

VIP Contributor
You have written so well but most time people don't want to go for short term loan becuase the amount that is always involved is not that much. This is the reason why people go through the stress of collateral and all those stuffs that are required of long term loan.
 
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kayode10

VIP Contributor
Someone needs to be very careful when trying to secure short term loan because it is a two edged sword. If care is not taken you might end up having more depth to pay in the nearest future. If you are unable to meet the initial interest rate given to you before you know you will discover that you are paying more than you owe.
 
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Inspirator1

Verified member
Sir, at what point exactly can a loan be classified as short term loans? Is it because the loan is short term there is no collateral? Guess, the financial system in your climes is different from my country; where each loan given is expected to have an assets attached to it. Even most banks in my country, does not give loans to civil servants.
 
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OP
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Augusta

Augusta

VIP Contributor
Unless you are borrowing from a private lender or from micro-lending institutions, you need collateral for your loan. Who told you short term loan does not require collateral? The only exceptions to this are micro-lending financial institutions and private lenders. However, I do agree that loan processing time is quick.
Short term loans don't necessarily need collateral mates unless it is an agreement by the lender but for a normal lending it shouldn't come with the issue of collateral. This is why the process is always very fast and less cumbersome. Short term means that the repayment period is very short. So check it is mostly without collateral attached
 
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OP
OP
Augusta

Augusta

VIP Contributor
Sir, at what point exactly can a loan be classified as short term loans? Is it because the loan is short term there is no collateral? Guess, the financial system in your climes is different from my country; where each loan given is expected to have an assets attached to it. Even most banks in my country, does not give loans to civil servants.
No it isn't about the collateral attached but the period you are expected to pay back. Short term loans have a duration of pay back between 6- 12 months. So it most times come at a higher interest rate rate than other kind of lons. The money received or given is also always smaller than the long given for medium and long term loans
 
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Good luck

Valued Contributor
All the reasons you stated above on the benefits or advantages of taking a short loan.It will be easy to pay back in a short time.It is even advisable to take a short time loan because immediately you pay back ,you will be able to apply for another using the same short term and before you know it,you will have achieved more .
 
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Alexandoy

VIP Contributor
In our country the short term loans usually have a higher interest than the loans that you can get from the bank or from a lending institution like a cooperative for labor unions. I only availed of a short term loan for emergency purposes especially when my bank account had no balance and there is no one to help me with my financial need.
 
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MOSIUR

Verified member
Actually, loans are not a good thing in the eye of me. Yet, people are to take loans whenever they fall in financial problem. I think, if you are in financial crisis, you can take a short-term loan. There are some benefits behind it. Since the amount is little, you will be able to repay it very easily. A very great tension will not come to you. Loaner will not be serious about it for a little interest. Thank you.
 
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Tuitiun

New member
Loans are not always taken out when there is a financial problem... sometimes additional capital is needed to fund growth. And if used well it can be the best investment.
 
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Abigael

Valued Contributor
Those are very good benefits of short term loans that you have given there. Indeed taking short term loans comes with less interest rates and so you can easily pay it back. Though their interest doubles up so quickly and so you should work hard to pay it back early. And that will increase your loan limits with time.
 
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