Simplifying the Realm of Short Term Loans

Created: 2016-10-04 00:00:00

There are various types of loans offered by banks, non banking financial corporations, government organisations and private companies. Loans are of two types: secured and unsecured. Secured loans are those where a certain amount of money is borrowed by an individual or a company after offering some collateral which is an asset or a guarantor that secures the repayment of the loan. Unsecured loans are those which are borrowed without offering any collateral, asset or guarantor to get the loan approved. Another classification of loans is short term loans and long term loans.

Short Term Loans: Explained!

Short term loans usually have small loan amounts approved for a short period of time. If you consider the larger loans like mortgage or car loans then the standard term for the former is normally 15 years to 25 years or even 30 years while the term for the latter, the car loans, is generally 3 years or 5 years. Some rare cases exist but these are what the industry standards are. Such loans are long term loans.

Short term loans are typically termed for a few days, few weeks to at the most a few months. Neither is short term loans as large as home loans or car loans nor is a short term loan repayable over 5 years or 20 years. In most cases, short term loans would deal with a couple of hundred pounds. The maximum you can seek is a thousand or in rare cases more than two thousand pounds. The repayment term could be a month or a few months.

In rare cases, it would exceed twelve months. Short term loans are unsecured loans wherein you do not have to mortgage your home, use any asset, financial or nonfinancial, as collateral or get someone to be a guarantor for you. Short term loans are ideal for temporary or transient financial problems, pending bills, a personal debt, medical or personal emergency. Compare loans in UK, like the short term loans offered by Cash Kitty, and pick one that suits your needs.

Warning: Late repayments can cause you serious money problems. For help, go to moneyadviceservice.org.uk