A Short-Term Loan offers almost instant cash to borrowers to be repaid typically within a number of days or months. Most of the time, this type of loan is used for an unexpected expense that you have not budgeted for but can pay back relatively quickly, such as car repairs. Short-Term Loans are usually the most expensive type of loan that you can apply for as the interest rates are high.
Criteria for a Short-Term Loan
There are certain criteria that need to be met in order to qualify for a Short-Term Loan. You need to be a South African citizen, you must be older than the age of 18, you must be employed, earn a regular income, and have an official bank account. Once you have submitted proof of these requirements, you will be subjected to a credit check before approval. This type of Personal Loan is often easier to obtain than most other loans and repayment terms are sometimes negotiable.
The most common type of Short-Term Loans are payday loans, where a small cash loan is paid out and you are expected to pay it back when you receive your salary the following month. Some creditors do allow a longer repayment period. Another type of Short-Term Loan is an asset-based loan, where you offer one of your assets to the creditor and you are given a loan to the value of the asset. If you default on payment, the creditor can gain possession of the asset to sell. However, if you pay it off in time, the asset will be returned to you.
If an unexpected expense arises and you’re thinking of a Short-Term Personal Loan to help you make ends meet, compare quotes on Hippo.co.za today to find the deal that suits your needs and budget.