Loans

6 Reasons Short-Term Loans Could Be A Better Way To Borrow

Short-term loans have received a lot of bad press over recent years. This was mainly as a result of exorbitant interest rates, administrative fees and other costs. Yet for many, a short-term loan is a viable option to get out of financial trouble. Here are six reasons why you might need to access a short-term loan.

The bargain of a lifetime 

Holidays are always important. If you’ve spotted a travel agent’s deal that’s too good to miss, then as long as you’ve done all of the sums and know that you can afford the repayments, a short-term loan will prove to be a welcome solution to any cash strapped shopper. Why not click here to see if you can afford a logbook loan. Unlike payday loans, you can repay the amount borrowed in small regular amounts until the debt is repaid.

No one wants to be locked into a debt 

If you’ve borrowed money, you don’t want to be locked into a repayment schedule that will prove costly and possibly inconvenient. You may even forget why you took out the loan in the first place. According to the website Money Saving Expert if you shop around you can still access a cheap short term loan, this might be through 0% introductory credit card offers or even a 0% overdraft rate with a new bank account. As long as you can prove that you have a good credit rating, this type of offer is the ideal way to source a short-term loan.

The future is always a mystery 

If you’ve worked out your budget for the foreseeable future and you are confident that you can meet your loan repayments, then a short-term loan is perfect for most purposes. No one has a crystal ball. Illness or accidents, or even recessions can occur at any time, so borrowing for a short period of time may be safer than a long-term debt.

Manage your debts 

A recent article in The Guardian highlighted the dangers of debt. Non-mortgage borrowing has reached a staggering £10,000 per household across the UK, or £239 billion in total and this figure is set to grow. This figure does include unavoidable student loans, which amounted for £9.1 billion of the £19.7 billion increase in 2014, and personal debt including loans and overdrafts amounted to £6.4 billion. If you want to manage your finances, a short-term loan that’s repaid within a fixed term may be your best option.

You need money quickly 

If you need funds in an emergency and don’t have time to wait for a bank’s decision on an overdraft, or your credit card is maxed out, then a short-term loan is perfect. You’ll be able to respond to the emergency and repay the money in over a short period of time.

Always read the terms and conditions 

Loans vary from company to company. Despite new regulations governing this financial sector you’ll still find that some loans are more expensive than others. As long as you understand the repayment schedule and all of the connected charges, then this type of loan can bail you out of a difficult financial situation.

June 1, 2015

Given Your Credit Card A Good Workout?

Yep, looks like most of us are in for a heck of a festive season credit card statement again! The Reserve Bank has quoted that we racked up a cool $18 Billion over last year’s festive season and this year is shaping up to top that. They also revealed, $50 billion in credit card debt is being paid off by 15 million Australians. Glad I’m not paying that hefty sum off on my own!

So what are we going to do about it? Let’s get real, we’re probably just going to keep spending, hey. Luckily, there‘s an Aussie company out there, called RateSetter who are the first and only company in our fine land, who provide peer-to-peer leading to everyday Aussies.

These guys actually want to help us by reducing interest rates for festive season spending and have provided some quirky and entertaining financial tips to downsize your debt. Imagine a January credit card statement of zero! Sounds too good to be true, but Ratesetter reckon their financial fitness plan will steer you in the right direction.

‘Weigh yourself’ to assess how financially (un)healthy you are

Take a minute to assess your financial health. Be realistic with yourself to determine the health of your finances. Will your wallet benefit from some fin-tervention? Often, the first step to financial recovery is acknowledging the state of your debts.

Trade in your personal trainer for a financial planner

Consulting an independent professional before undertaking a new financial regime is a worthwhile investment in your long-term financial health plan. Get someone to cast an expert eye over the big picture of your financial fitness – including your credit card debt – and you’ll find that you can put their in-depth knowledge and professional skill to work.

Take a finance detox and stay away from ‘junk food’

Whilst it’s called the ‘silly season for a reason, consider detoxing your wallet by cutting out non-essentials like take away food, bottled water and that daily coffee. It’s amazing how much small purchases we all consume, actually mounts up to over a year.

Get finance app friendly

Take advantage of the many free budgeting apps available on smartphones and tablets. These are perfect tools for those who want a little daily assistance to keep on track.

Making sure that ‘hidden calories’ aren’t blowing out your financial diet

Are your interest rates sabotaging you? If you’re struggling to get back in the black, it might be time to review what your credit cards are really doing to your financial diet. Try considering ‘healthier’ alternatives to credit cards, such as a peer-to-peer personal loan where you get to determine your own preferred rate. You can consolidate your credit card debt and pay lower interest rates with a peer-to-peer loans.

Sounds almost achievable hey? So if you want more information on peer-to-peer loans to reduce your festive season debt and to get some home grown, Aussie financial advice check out RateSetter.com.au.

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January 6, 2015

5 Reasons to Use Debt Consolidation Loans

A few maxed out credit cards, a personal loan that’s accumulating a lot of interest, and suddenly you’re feeling swamped with financial problems. Believe me, it has happened to the best of people, when at one point in our lives, most of us have faced financial hardships.

But you have to come to terms with the situation, stay calm, and focus on how to come out of the mess. We look at five ways debt consolidation loans can help you financially and allow you to get back in control of your money.

1. Lower interest rate

Typically, a credit card loan is calculated at an interest rate which may be anywhere between 12.5% to 23% per annum; while a debt consolidation loan may charge 8.5% to 18.99% in interest, depending on fixed or variable interest rate. But remember that a lower interest rate on a higher principle amount can result in you paying a lot more over the long term.

2. Improves credit rating

If you’ve opted to take a debt consolidation loan, rest assured that payment of all your assorted loans on time will improve your credit rating in the eyes of the financial institutions, making you eligible for future loans or mortgages, should the need arise.

3. One regular payment schedule

Consolidated debt means one single payment every month, instead of numerous payments to be made to various financial institutions. Suddenly making repayments becomes a smooth, quick process, without you having to get stressed managing all the loan repayments spaced over the month.

4. Reduce debt processing fees

Sick of those late payment fees? A debt consolidation loan will work towards lowering your processing charges for each loan or mortgage you owe. But this will only work if you do your homework, and compare the pros and cons of each loan versus others you have already started. So do your research carefully.

5. Control of finances

A conscious decision to go for a consolidated loan will bring you a feeling of control of your finances, as you will be forced to look at your spending habits and take stock. Also Equated Monthly Instalments (EMI) on your loan will take away a chunk of your income every month, forcing you to take charge of your finances once again. But this is a good thing!

Check your bank’s website for an online debt consolidation calculator, do plenty of research and speak to your bank or a financial expert before choosing a debt consolidation loan.

July 26, 2013