Short Term Personal Loans - Repay Small Amounts Early

by : Michal John

Often, it is only for few years only that we need a loan for. One motive for taking out such a loan could be to escape from paying interest for a long period in order to avoid stressing one's finances too much. Short Term Personal Loans can be one such loan for your requirements and circumstances, if you avail it in a wise manner. The loan can find its use for host of personal purposes including home improvements, paying off old debts, purchasing a car, paying for wedding or holiday expenses etc.

These loans involve a short-term of repayment. Depending on the borrowed amount, your repayment capability and credit history, the loan can be picked up for repaying it in six months to 15 years. Therefore, you do not have to carry the loan undesirably for many more years, when you can repay it earlier.

Short-term personal loans are of smaller amounts, ranging from ?3000 to ?25000. So, you can repay the lower amount of loan in say six months, or a higher amount in say 10 years. However, keep the repayment duration short to avoid high interest payments in the end. You must also note that these loans do not require any security from the borrowers, as these are unsecured loans. Both tenants and homeowner can have access to the loan.

However, absence of collateral prompts the lenders to charge interest at a little higher rate. Usually the rate is fixed for life of the loan, enabling you to know beforehand the monthly outgoings, and you can plan the loan accordingly.

Make sure that you have applied for the rate quotes of the lenders, who are providing short-term personal loans. This way, even bad credit borrowers can find a loan even if they have late payments, arrears, defaults or CCJs against their names. Compare such offers of loan keeping your circumstances, rates and additional charges on the loan in mind.