What is a Short-Term Loan?
Short-term loans can help you get the funds you need quickly. These types of loans can help you cover an immediate expense or hold you over until your next paycheck, depending on your financial needs. Here’s what you need to know about what short-term loans are, how they work, and the different types of loans available to you.
How do short-term loans work?
Short-term loans are loans that you can repay very quickly, often in a year or less. Many of these loans come with repayment terms of a few months or even weeks. Banks, credit unions, and online lenders usually offer short-term loans with varying amounts, interest rates, and terms.
Benefits of short-term loans
The most significant benefits of short-term loans include:
Receive funds quickly
Once you apply for a short-term loan, you won’t have to wait long to receive the money. Many lenders who offer short-term loans will transfer the funds to your bank account that same day or within 24 hours.
Quick online application
Many lenders offer online applications that you can fill out from the comfort of your home instead of having to visit a lender in person. Short-term loan applications are usually easy to fill out, and may only take you a few minutes to complete.
Easy to get approved
Short-term loans often come with lenient requirements, and you can get approved even if you do not have exceptional credit. Keep in mind, however, that you may have to show proof of steady income or meet other criteria.
Types of short-term loans
Here are a few types of short-term loans that may be available to you:
Payday loans
Payday loans are small short-term loans that you can repay the next time you get paid. In most cases, payday loan repayment terms range from two to four weeks. A payday loan may make sense if you need some cash to hold you over until your next paycheck.
Installment loans
Installment loans allow you to borrow a lump sum of money and repay it over time via fixed monthly payments. Since you’ll know exactly how much you’ll owe upfront, you’ll find it easy to budget for installment loans.
Lines of credit
Lines of credit offer a flexible way to borrow money. Instead of getting your funds all at once, you’ll be able to withdraw as much or as little as you’d like up to your credit limit, similar to a credit card.
Merchant cash advances
If you own a business, a merchant cash advance can give you the chance to receive a lump sum of cash. In exchange for the money, you’ll agree to pay back the lender with a percentage of your future credit card or debit card sales.
Invoice financing
Invoice financing is another short-term loan option if you own a business. After you submit your invoices to a lender, they’ll give you the invoice amount minus a percentage that they’ll keep as payment. Then, you’ll repay the lender once your customers pay your invoices.
Advance America offers fast short-term loans
Advance America offers short-term loans such as payday loans and installment loans. You can easily apply for any of our loans online using your computer or mobile device, and you don’t need good credit to get approved. Our short-term loans can give you the fast cash you need to cover an expense without the time or hassle.
