If you aren’t in a position to save, don’t have emergency cash to fall back on, and payday is still some way away, a short-term loan – also known as a payday loan – might be worth considering.

Short-term cash loans can provide the financial flexibility you need to ensure your affairs are in order when unforeseen circumstances pop up. They give you access to the money when you need it most. Small loan amounts and short repayment times make these loans ideal for when you need cash quickly and can afford to pay it back over a short period of time.

short-term cash loans

However, it’s important to remember that short-term cash loans are not long-term financial solutions. Sure, if approved, you can have the money in your account almost immediately (mostly on the same day), but it’s vital that you take the time to consider when you should take out a short-term loan and the costs involved.

Looking for what to consider before applying for a short-term payday loan? Download our eBook for more information.

When should you use a short-term loan and how can you use one effectively?

Typically, short-term cash loans are used for emergencies; car breakdowns, healthcare, unexpected bills, household repairs and other things that you need to pay off immediately but can’t due to cash flow issues.

If you want to use a short-term loan effectively, you should…

1. Use it for the things that really matter

Rather than using your short-term loan for a spending spree, night out or a holiday, you should use it – as mentioned previously – to cover unexpected costs. Think household repairs, health issues, and personal crises.

Short-term cash loans are not ideal for major projects, investment, paying off large debts or any financial activities that require a significant amount of money. Also, you shouldn’t use short-term cash loans to manage existing debt.

2. Create a budget and stick to it

A short-term loan might help you out of a difficult financial situation, but you want to make sure it lasts you until your next payday. With this in mind, budget! Make a list of your emergency expenses – such as those listed above.

3. Meet your repayment schedule

Short-term loans can help you to cover unexpected costs, but if you do not pay the lender back in full, on time, you may suffer further costs and damage to your credit rating. Where possible, stick to the repayment schedule to avoid any potential problems. If you stick to the repayment schedule, you will pay as per the agreement and avoid incurring any additional charges for late payment. If you are having difficulty meeting the repayment schedule, get in touch with your lender. If they do not know, they cannot assist you.

How can you get the right short-term loan?

A short-term loan might provide you with some much-needed reprieve but you also want to think about how you are going to pay it off and whether or not you will be in a position to do so!

First and foremost, determine your budget. Ask yourself; how much do you want to borrow? How much can you afford to pay back? And how quickly do you want to pay it back? Having answers for these questions will enable you to choose the right short-term loan and ensure you have everything under control. Ultimately, it’s about being responsible with your money.

Having ascertained your requirements, shop around for the best deal – do your homework. Price comparison websites, such as All The Lenders, can help you to find the best deal. While there are a number of short-term loan providers, you want to find an outfit that will treat you fairly, deliver honest customer service, provide all the information you need and work with you to design a fair short-term loan plan.

Ultimately, choosing a lender is an important decision that goes beyond just a price tag – and with that in mind, you should choose a provider that can deliver exceptional customer service, reliability and years of proven service.

At Uncle Buck, we are committed to providing our customers with honest, forthright customer service and responsible payday loans. We treat our customers fairly, giving them access to all the information they need to make informed borrowing decisions and operate a UK call centre, meaning our customers can get in touch whenever, wherever to speak to someone who can help.

If you want to find out more about what to consider before taking out a short-term payday loan, click below to download our eBook.

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