Short term loans are on the rise because they are good enough in their patterns of borrowing schemes. These can be afforded by individuals to companies and almost everyone. The most important part of such loan services is that quite often the past employment history of the person is not taken into consideration by the generous money lending companies.
WHEN IS IT REQUIRED TO TAKE SHORT TERM LOANS?
The short-term loans are essentially required when the purpose that needs to be fulfilled has a tenure of less than one year. This is mostly required when the credits are not available from eh banks. So, there are organizations that can provide a steady help to the people who are in urgent need of the money.
BANKS VERSUS THE PRIVATE LENDERS
Before going for a loan it is important to decide whether to access from banks or private organizations. These will be dealt ina smooth way in the following section.
- Rates of interest:
The rates of the interest may vary depending upon the type of bank and also the private organizations. Some banks do offer the interest rates of a minimum of 36% while some private organizations may offer at highest rates like 2000%. But this is not always important to be marked that all yet private organizations offer such heavy interests. Some others also offer interest rates up to 150%.
The approval of the loans is quite easy when accessed from the private organizations because of there is less paperwork and lesser detailed check for the past history of employment. For banks, it is a law to check the background and the employment history of the individual before lending a loan with the involvement of the paper works.
The approval of the funds is quite easy and speedy in case of the short-term loans which require only 2 minutes and for processing about 10 minutes. This is obviously quite speedy than the banks and especially from the Government banks.
The rules and the regulations that are offered by the banks are quite tougher in comparison to that of the private organizations. Banks are often involved in eliminating a number of people from the criteria of rendering loans. This is never a problem faced by the private organizations.
This is an important one. It is obvious that the banks are reliable because they follow the stringent laws. However, private organizations can be a good choice if people check the safety rules and regulations of the organization before the money is lent.
In general, it can be concluded with this theory that the payday loans can be a great one but till the time they work within a shorter rate of interest. Sometimes, the certain rate is so high that it becomes too hard to pay off.