The term Short term loan itself suggests that these types of loans have a short repayment tenure. In most cases, you have to repay the amount within six to twelve months. The duration of repayment can get to 18 months max otherwise the loan will be called a medium-term or long-term loan. Long-term loans are preferred over short-term loans if you want to repay the loan amount taken for a house or something in which a lot of investment is needed. Short term loans are available in many types, some of them are mentioned below:
Personal loans are the most favored type of short-term loans that people avail themselves of from lenders. Such loans are collateral-free and you can use the amount as like. Being collateral-free means personal loans can be a risky deal for lenders so they charge a high interest rate. Some lenders offer personal loans based on the needs of the person applying for the loan.
Bridge loans can help you in getting out of a financial crisis if you’re already waiting for an amount. This type of loan is also called ‘Interim financing’ or ‘Gap financing’. Bridge loans are mostly preferred by the people involved in the real estate business. Such people take a bridge loan as a quick loan to pay the down payment of a property while another sale of their existing property is in progress.
Payday loans are the type of short-term loans that are taken when the money is needed urgently. The borrower will get the loan amount and has to repay the whole amount with interest when the payday arrives. Such loans carry a high-interest rate but are the best when you know you can pay the amount when you get your pay.
If you are running out of cash but can’t afford to wait until your business begins to generate income, then demand loans are the perfect short-term solution for you. Demand loans are secured loans that are availed with security or collateral against which the loan will be sanctioned by the bank. Banks usually accept fixed deposits, life insurance policies, NSCs for individuals and invoices, lease rentals, or accounts receivables for businesses as collateral.
A bank overdraft facility is provided by almost every bank. With the help of it, you can borrow a specific amount of money even if your account does not have that much cash to cover such withdrawal. Also, you can borrow money within a sanctioned overdraft limit. If you’re choosing a bank overdraft over other types, be prepared to pay some additional costs associated with it.
If you’re searching for a reliable lender online, you can consult swiftloans.com.au to get any type of short-term loan. Choosing them will give you several benefits like no waiting for approval and no paperwork involved in the process. You can get fast and easy loans from them like dentist loans, rent and bond loans, vet loans, etc.