The uncertainties revolving around one’s life makes it almost impossible to predict when there will be a need for financial support. Fortunately, at crucial times, quick lending schemes like short term personal loans will be a great way to raise funds.
Most of the people thought that personal loan and short term loans are the same loan but there is a difference. Short term loans are unsecured personal loans.
What is a Short Term Personal Loan?
As the name suggests, the short term personal loan is a form of unsecured personal loan useful for meeting emergency expenses. Generally, short term loans can range from Rs. 5,000 to Rs. 3,00,000 and can change depending on the lender you choose.
Generally, Short term loans are similar to personal loans, but the difference is the repayment period. The repayment period is much shorter than that of a normal personal loan, and these loans are available a little sooner than normal personal loans.
As the amount involved is relatively small as compared to other types of loan, the tenure associated with it will also be shorter. Depending on the lender you choose, the loan tenure can vary from two months to three years.
This loan is sanctioned and granted to a large extent within a few hours or within a day or two. This type of loan can be taken for sudden unintentional expenses before marriage, for medical expenses, for making a big purchase, or if you need immediate cash for your business.
When planning to avail a short term loan, it is best advised to analyse your financial capabilities and borrow the amount that you are capable of repaying without any hassle. This will make the lending process a fruitful one for you.
To make short term loans a hassle-free experience, you need to make sure you choose a trusted and reliable lender. Here’s how you can do it.
Lender’s Experience in the Industry
When finding a prospective lender, the first step is to look into their experience. You need to make sure they will offer you a short term loan with the least processing charges and in the shortest time possible.
Along with that, you must look at the number of years the lender has been in the industry. It is an excellent indicator of their desirability. A trusted lender such as Fullerton India, with decades of experience as a renowned lender, is an excellent choice for you to consider.
Once you have found an ideal lender, you need to discuss with them your requirements. Talk with them the amount of money you will need as a short term personal loan and work your way from there. By analysing your credit history and repayment capabilities, the lender will suggest to you the maximum amount you are eligible for borrowing.
Interest Rates Offered
Once you have successfully conveyed your requirements, the lender will intimate you the interest rates you will have to pay for the loan amount. As you know, interest rates are calculated on several factors, including your CIBIL score, repayment history and the amount you tend to borrow.
As these rates decide the total amount you will be paying, you need to consider them clearly. The lower the interest rate is, the better. India’s leading lenders such as Fullerton India offers industry’s best interest rates.
As all personal loans are unsecured; you wouldn’t have to submit any collateral to avail one. However, there are other personal loan documents you will need in hand to make the process faster. Here’s a list of them:
- Identity Proof (Passport / Driving License / Voters ID / PAN Card )
- Address Proof (Utility Bill less than three months old / Leave and
- License Agreement / Passport)
- Salary slips for three months
- Latest three months bank statement
- 2 Passport Size photographs
However, the requirement of personal loan documents can vary depending on the lender you choose.
While availing loans, it is crucial that you choose a lender who offers quick and reliable customer services. Otherwise, you will be confused in the long run, especially if you have some questions to clear once you avail the loan. Hence, instant support is a healthy financial relationship trait that you must foresee on your prospective lender.
All of these factors are influential when it comes to choosing a lender to avail a short term personal loan.