Times When A Short-Term Loan Could Be Your Ideal Solution

When you find yourself short on cash, the great thing is, there are plenty of avenues you can seek help from. In Singapore, you can obtain loans from not just banks but also a variety of credit companies and licensed moneylenders. However, it’s inevitable that you will run into another problem – deciding which loan to get.

One aspect you must decide on is the duration of your loan plan. This determines how long the repayment period is, and usually affects the maximum amount you can borrow. There’s no one better option when faced with the choice of short-term loans or long-term loans, as it depends on your needs, abilities, and preferences.

Here are some cases in which a short-term loan might suit your needs:

1. You need quick cash

Short-term loans are ideal if you are looking for quick cash flow. Sometimes small scale businesses need some ready cash to tide over cash crises. In such scenarios, it is best to take short-term loans. These loans have short repayment time, and hence, the moment the resources are in place, the entrepreneurs can repay the loans. Since the loan repayment time is shorter, you will not face any penalty if you repay it before the deadline is up. If you are facing a temporary credit crisis, then short-term loans are the best solutions.

2. You just need a small amount

While long-term loans are great for funding huge expenses like education, a car, or home, short-term loans are more suitable for small amounts. There is less risk involved with short-term loans, as the repayment period is shorter, which also means fewer opportunities for you to default on payments or rack up high interest fees or penalties. The small loan amounts also make them more manageable on your wallet to repay.

3. You’re not eligible for other loans

Due to the lower risks associated with short-term loans, the eligibility requirements set by moneylenders are usually more lenient. This means a higher likelihood that your loan application will be approved, and an easier application process for you. Most short-term loans wouldn’t require the borrower to provide collateral, and some even enable borrowers with bad credit scores to borrow.

4. You’re looking for convenience

Thanks to the quick application process, short-term loans are often the easier choice. You’ll need to provide fewer things for the application, and with some moneylenders you can even apply online. Plenty of moneylenders in Singapore provide some sort of short-term loans, so they are easy to source for. Payday loans are a great option if you are confident you can repay the loan by your next paycheck.

Conclusion

Both long-term and short-term loans have their pros and cons, but these are just some reasons why you might find a short-term loan perfect for your situation. Although short-term loans are quick and low-risk, it is still vital to be mindful of the lender you choose. It is always wise to stick to licensed moneylenders in Singapore to enjoy a safe and fuss-free experience. When in doubt, refer to the Registry of Moneylenders for their list of moneylenders in Singapore.

Bookmark the permalink.

Comments are closed