Unexpected expenses warrant financial help owing to a lack of funds in hand. You may be undergoing a medical emergency, or your vehicle breaks down and needs major repairs. When you have exceeded your credit card limit and have no savings to tap, a quick cash loan saves the day.
Such short-term loans allow easy access to funds and do not demand security against them by attaching an asset or property. You can conveniently apply for them after making a comparative study of available options.
Once your application is approved, the borrowed funds are soon made available to you. The two main types of quick cash loans include:
- Personal loans allow you to repay over a series of monthly installments. Under this scheme, the interest rates are lower, with a custom-made repayment plan to suit your budget.
- Payday loans, you can repay on receipt of your subsequent paycheck. Though they attract higher interest rates, even a low credit score entitles you to avail of them.
Refer to these five guidelines to select the best quick cash loan option that works for you:
Weigh all the pros and cons of the options before you by taking into consideration critical aspects. These include the loan term, repayment plan, and interest fees, neither of which must lead you into a potential debt trap.
Even if you have a substantial period to pay off the loan, the expense you incur will be much higher. Missing a payment deadline attracts added interest. When aligned with your budget, the repayment plan can save you from paying exorbitant fees and service charges.
Scrutinize Interest Rates
Borrow an amount you can repay within the agreed period. Going ahead with a loan amount that proves mighty expensive when the interest piles on, is not worthwhile. As a borrower, your income, ability to repay, and credit history determines the approval of your requested loan amount.
Conduct Due Diligence on the Lender
Avoid dealing with lenders of disrepute who are only focusing on taking advantage of your current predicament. With reputable lenders, you will have a better borrowing experience as they charge as per the prevailing market rate.
To determine the reputation of a lender, verify that they have a valid credit license and are easily reachable. They must also be transparent while sharing information about the fees levied and their loan conditions.
Examine the Legalities Involved
Before signing a binding quick cash loan agreement, carefully read the conditions reflecting as they apply to you till you clear all payments. Since instant cash loans are typically unsecured, the lender can resort to legal proceedings against you. This extreme step is initiated when you are unable to repay the loan amount and associated fees.
Check Timeframe to Access Funds
If the lender takes time to respond to your request after submitting all the required details, your purpose stands defeated. At the outset, get clarity from the lender on their procedure for loan approval and the expected turn-around time for receipt of funds.
Borrow responsibly by first understanding the terms, costs, and potential risks involved to avoid problems in the future.