“Quick loans” is the trickiest segment in the financial industry. So many financiers in this domain float some fancy names like “Instant loans,” but many of these loans are more of payday loans or cash advances and are loaded with so many conditions. For some, even after approval, you don’t get your cash instantly- and if you’re not aware, you may end up getting frustrated.
But the fact is, these loan types help a lot, especially when you have an emergency, and you need cash instantly.
Get a few things you need to know before you go for a quick loan
How quick loans work
You can fill an in-person form, but nowadays, almost every “quick loan” financier has gone online. The application includes the amount you’re applying for and the repayment period. You also supply your personal information like your liabilities, assets, income, your payday, if you’re employed, etc. The lender then promises to draw down the amount in your account in a few minutes once the loan is approved. Most lenders will take a few minutes to approve and send the amount, while others can take hours, days, or weeks before you receive it. So before you apply, check out for reviews to see what experience others have with the financier.
The loan may not be instant.
While the process may take a shorter time for an in-person application, the online may take some time, hours, or days to send the money to the account. If you provide insufficient information, it may take longer to get the money due to the back and forth.
The interests can be high.
Many loans with the tag “instant loans” are pretty expensive. They come with high fees and sky-high APRs. Sometimes, you could pay a total of $15 for a loan of $100, depending on the laws in your state. That translates to an APR of about 400% for a two-week loan- costly. Others charge even higher fees with APRs to the tune of 700 to 900%.
The assumption here is that the loans are risky because no collateral, and you can even get them when you have a low credit score. Most people who go for these find it the best option with fewer conditions.
They are small amounts.
These are not the loan types you take to do a major home improvement project. The average amount is hundreds of dollars because they are viewed as emergency loans. Therefore, if you’re looking forward to some substantial amount for a bigger project, this is not the option for you.
They are short-termed
These types of loans are assumed to be payday, and therefore you’re given some weeks and a maximum of a month to pay back. Therefore, before you go for it, you have to be sure you’ve to be sure you’ll have the money within a few days to repay.
You may be approved with a bad credit score.
These loan types are very attractive to those with low or less than perfect credit scores.
The only problem here is this type won’t help you build credit. This is because most lenders don’t check your credit score. But with an emergency, that’s not your priority.
Get a reputable lender with clear and straightforward loan conditions when looking for Quick loans. Avoid companies that will entice you with those flashy names like “instant loans” but end up charging you exorbitantly. Do your research, check reviews and compare as many lenders as possible before settling for one.