AD| For me, taking out a loan is always the last resort. I believe that you should start building an emergency fund to cover any surprise large expenses and save for things before buying them on finance or credit.
If you do need to use a loan, then it needs to be your last option because when you borrow money, you have to pay it back with interest, so it’s more expensive overall. Unfortunately, life happens and sometimes we have a large expense that is unplanned but necessary.
This is where cashasap.co.uk may be able to help.
cashasap.co.uk is a high-cost short term credit provider for short term loans. It offers small loans to customers that struggle to get credit from other places. They are customer-focused and encourage responsible borrowing and are regulated by the Financial Conduct Authority
After applying online, cashasap.co.uk uses Open Banking to assess whether applicants can afford the loan before being approved. You can check the exact dates and repayment amounts before you apply to ensure you are fully aware of what you need to pay back and when.
cashasap.co.uk offers loans between £150 – £750 for periods of 1 – 6 months. So if you borrow £150 for 6 months, you would start paying it back in instalments over the next 6 months. The date you pay each instalment will be tailored to when you get paid, so it’s a great way to manage payday loans.
Benefits of short term lones
If you need your money quickly, this is where short term loans may be a good idea as you can get the money approved quickly and get it in your bank.
This is good for an emergency situation, such as your car failing it’s MOT and you need it fixed quickly for work.
Boosts your credit rating
Getting a short term loan and paying it back on time will give your credit score a boost. This is great if you have a low credit score as it can contribute to a better chance of getting credit or a mortgage in the future.
It’s short term debt
Most other loans are paid back over a long period of time which means you are in debt for longer. A short term loan will only see you in debt for a few months then you are back to being debt-free!
Short term loans are regulated by the FCA to make sure you can afford the repayments by looking at your disposable cash.
Option for bad credit scores
If you are struggling to borrow from a bank and secure an overdraft due to having a bad credit score, this is a good option to get some money quickly when you really need it.
Disadvantages of short term loans
Higher interest rates
As short term loans are unsecured and high-risk to the lender, they have a high interest rate. Always check the total amount repayable before getting a short term loan. The APR will be displayed due to it being a legal requirement but this is interest over a year, not months.
Most short term loan companies charge a penalty from the first day you fail to pay your loan repayment. Always check for additional fees and charges like this. Consider checking up a pre-approved payment with your online banking so you don’t miss a payment and get charged!
If you are reading this blog post because you are in debt and worrying about money, please visit Money Helper for some free advice. If you are looking for ways to make some extra money without taking out a loan, check out some ways I’ve been making extra cash while on maternity here.
Loans like this should only be used in emergency situations to foot a cost you cannot avoid. They should never be used for gambling, booking holidays or other things that you can do without.