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Short term loans – Simple Checklist For You To Follow Before You Get A Loan In 2022

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If you’re thinking about getting a loan, then there is more to think about than just the amount and how long you will need to pay back. You have rates to think about that affect the amount that you can borrow and also how high your repayments are.

You will also have your credit score to think about that will affect how much you can borrow, what time period and if you have a bad credit rating it can affect your rates and make repayments higher.

To help you out, we have put together this simple checklist that will give you the main areas that you need to think about before you get a loan. Once you have been through the steps you will be far more confident to get the money that you need and have more of an idea of your repayments and the available options.

Checklist To Follow Before You Apply For A Loan:

1. Work Out What You Need First:

The first thing you want to be certain on is how much money you actually need. Remember, when you are applying for a loan, you will want to make sure that you need the money and do not borrow any that is surplus to requirements.

Essentially, before you borrow any money you will want to have a really good idea of what you need it for and also costs.

As an example:

“If you were borrowing for a home renovation, make sure that you know exactly how much you need to borrow. It is not a good idea to borrow money when what you need is left wide open, and you could either borrow more than you need or end up needing more money.”

Another big part of this is to only borrow money that you can afford to repay.

2. If you Can Go For A Short Loan Period:

Depending on how much you are borrowing and where from you may not be able to go for a short loan period. However, if you can we recommend it as it will allow you to pay the money back faster and be out of debt. Especially when you are talking about short term loan you will not want to be tied to debt for a long time.

3. Check These 3 Things:

The main details that you will want to look at with any loan are:

The interest rate.

The fees.

The Terms.

The interest rate will let you know how high your repayments will be. You will want to look at the fees to make sure that there are no hidden ‘nasties’ in there.

You will also want to make sure that you look at the terms, we highly recommend going for a fixed term so your repayments will not change.

4. Compare Loans:

Of course, you will also want to compare loans and the best way to do this is to check the APR, which is the rate and the total repayment amount. If you look at these two areas when you are comparing it will give you a rough idea of the competitiveness of the loan and lender.

5. Go Fixed If Possible:

As we mentioned above, you will want to go for a fixed loan if possible as that will mean that you know exactly how much you are repaying, and those repayments will not change. Bear in mind that you will also want to make sure that you do not get any hidden fees.

6. Know Where You Are Borrowing From:

Make sure that you know where you are borrowing from. If you are borrowing from a bank or a financial institution, then make sure that you know that it is a reputable company. With online loans, make sure that you go to a website that will either compare loans so you can get the best choice like we do here at Money Pig.

The main red flags are any online website that asks for money BEFORE you get your loan. Stay away from these scams no matter how good the deal sounds.

7. No Credit Check Loans:

As we have explored here on the site, no credit check loans are possible however you will normally find if you do not have to provide a proof of income or a credit check will find that the interest rate is going to be a lot higher and you will normally only be able to borrow a small amount of money. As a rule, we would not recommend going for a no credit check loan.

If you absolutely need to go for a no credit check loan, this will imply that you have bad credit. So, if you absolutely need to go down this route make sure that you only borrow the money that you need and think very carefully about your repayments, so you do not get yourself into financial difficulty.

8. Keep It Simple:

We highly recommend not applying for multiple loans, if you do make sure that there is a time gap between each one. This will save you from getting into financial difficulty and it will also make it far more likely that you will be approved for a loan.

9. Understand Terms:

Taking into account all of the above, make sure that before you sign anything or agree to any loan that you understand the terms completely. This will save any problems down the line, and it will also make your loan experience far less stressful.

10. Final Thoughts:

Getting a loan does not have to be a difficult, arduous task. Just make sure that you follow the checklist above and you will be in a really good position to know exactly what you want to borrow, how much you can afford to repay, and you will also be able to compare loans to make sure that you get the best rate.

Here is more help around some of the areas mentioned above:

How To Work Out How Much To Borrow?

We recommend the before you borrow any money, you write down exactly how much you would like to borrow. The easiest way to think about this is what you need the money for, once you have got a good idea of what you need the money for it will be easier to plan exactly how much you need to borrow.

If you get stuck you can also check out some borrowing calculators that you will find online, this will give you a rough idea of what your repayments could be based on how much you want to borrow. Here at MoneyPig. We also give you a complete breakdown of how much you could borrow and what repayments you would have.

How Long To Borrow?

Remember, the longer you end up borrowing for the higher the interest you will need to pay. So, make sure that you think about a shorter loan period which will raise the monthly payments, but it will save on the interest. When you are dealing with short-term loans, try to keep the term below two years.

How To Compare?

The best way to compare loans is to go directly to your bank and see what is available to you, you can then use this APR rate and any fees as a guideline when you are comparing loans online. Bear in mind, if you are using a comparison site to compare loans that the lowest rate may not be applicable to you.

To get a very low rate you will most likely have to go for a credit check, and it will depend on your credit score.

One of the quickest ways to get a really good look at exactly what your repayments will be and the loan amount that you can obtain - we recommend using an application like we have here at MoneyPig, that gives you a complete breakdown of all of the repayments when you apply.

No Credit Check Loans:

As a final thought, even though it is possible we recommend staying away from no credit check loans. It will always make your payments higher, and you will only be able to borrow a short amount for a short period if you go down this route.

Conclusion:

We hope this checklist has helped if you’re looking to get a loan in 2022.

The main takeaway from this article to help you are:

Know What You Need To Borrow.

Only borrow what you need.

Have a good idea of the APR, repayments and the terms.

Compare loans if possible and have a good idea of the exact repayments.

Stay away from no credit check loans.

Can We Help?

If you want to see how much you could borrow with MoneyPig, click the link below and go straight through and apply for a loan where you are able to see the exact amount that you can borrow and the terms:

Click here to apply for a loan with MoneyPig…