Here at Cash Kitty we understand that not everyone is familar with the different types of loans available to them. This is why we're going to go over the types of short term loans in the next section to give you a better understanding of the options available.

We're going to be taking a look at overdraft facilities, credit cards, payday loans and also a couple of the companies that Cash Kitty are up against, finally, we're going to be diving into exactly why Cash Kitty is the perfect place to actually get a short term loan. Finally, we'll cover our loan rates here at Cash Kitty.

Cash Kitty loans

Short term loans are a financial product, just like home loan and car loan. Many people consider a car loan as one of the types of short term loans and they may be right in certain circumstances. If a car loan has a term of one year or less, then it can be deemed as a short term loan. Car loans that have repayment terms of five years or even three years cannot really be classified as short term loans.

The banking and non-banking along with the regulated and unregulated financial industry classifies short term loans as any lending that has to be repaid with interest within twelve months, preferably much earlier. There is another misconception about short term loans that needs clarification. Short term loans can be secured and unsecured. Just as payday loans are unsecured short term loans, personal loans from banks against collateral or with a guarantor to be repaid in a year would be secured short term loans.

Beyond the difference of secured and unsecured, there are many types of short term loans. Here is a sneak peek.

Overdraft facilities offered by banks

Overdraft facility is a common service offered by banks. This is directly related to a savings or checking account. Overdraft is common in the UK for businesses that operate a company account, also known as a current account. Overdraft is usually not available with savings accounts in the UK or with salary accounts. Some privilege account holders, such as premium customers or those with a substantial bank balance, may get the overdraft facility.

Credit cards and short term loans

A Credit card is essential a type of short term loan. Credit cards come with vastly varying limits. The limits are essential the maximum loan amounts. You could use a hundred quid and repay it in thirty days or longer. The hundred quid is the loan amount. You don't pay any interest if you pay it in full by the next billing cycle. If you don't pay it in full, you pay interest. Credit cards are the most common type of short term loans in the world. They don't operate as loans in the traditional sense as in you don't apply for a new loan amount every time you need to buy something and pay with the card. The transaction itself is a form of approval of the loan, as long as you are within the limit.

Payday loans are short term loans

Payday loans are short term loans. Unlike overdraft and credit card, payday loans are short term loans for people with bad credit. Those who have a poor credit history or bad credit will not qualify for credit cards or overdraft. There can be some credit available from the bank one has an account with but loans would not be approved. Whether it is a car loan or personal loan and any other secured loan, bad credit applicants will have to resort to private lending or un-institutionalised lending. Payday loans are unsecured loans, available for borrowers regardless of credit score.

Cash advances from the company one works with

Cash advances from the company one works for or private lenders offering some cash advances are similar to payday loans. Only the source is different. Cash advances are short term loans that are repaid, at times without interest when it is a company lending to the employees. The repayment term is usually just a few months. It could be one month too, which will be exactly what a payday loan is.

Money market offers short term loans

Money market offers short term loans. There are some lenders who have more cash than they can lend. There are lenders who run out of their funds. Money market is a conglomeration of sorts where lenders signed up in a network pool in the surplus or available funds, facilitating the lending to new borrowers. This is more like a syndicate or a collective fund being channeled through one body where every lender is a signatory. Money market can be of banks, financial institutions, investors or private lenders.

Cash Kitty offer loans for bad credit

Other types of short term loans are refund anticipation loan which is a consumer loan, bridge loans which are usually a part of a longer term loan and pawning where you use a precious item as guarantor for some money which you repay and get your item back. The best type of short term loans is from private lenders who don't ask for guarantors or collaterals and wouldn't have a high credit score criterion, the kind Cash Kitty facilitates.