Learn About the Processing Fees for Short Term Loans

Created: 2017-07-07 00:00:00

Learn About the Processing Fees for Short Term Loans

Short term loans can be secured or unsecured. Regardless of the nature of collateral or guarantor needed, the credit score criterion and other factors, there may or may not be any processing fee. It depends entirely on the lender. Some lenders have a stated policy of not charging any processing fee. Some lenders will make it clear at the very outset that there is an upfront processing fee. A few lenders are rather ambiguous in their initial propositions. They don't say if there is any charge you must bear for the lender to process your application and when the loan amount would be disbursed following the approval. It is your responsibility as a borrower to find out and be sure of whether or not there are any processing fees for short term loans.

Processing fee is not uncommon. Most banks charge such fees for home loans, car loans and all other types of secured or unsecured loans. The problem is not the charging of such a fee but keeping it concealed or deliberately misleading the borrower. There are some lenders of short term loans that do not explicitly declare any processing fee but would charge you one when the loan is about to get disbursed. Worse in certain cases, some lenders deduct the processing fee from the loan amount being disbursed and you cannot even raise an objection then. Perhaps the processing fee was somewhere buried in the terms and you may have missed it or not read all the clauses with a hawk eye.

Be upfront with a lender and ask a straight question. The amount being charged as the processing fee must figure into your calculations while comparing the various propositions from different lenders. Do not ignore the fee even if it is a small amount because concealing it is just malpractice on the part of the lender.

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