Short term loans are becoming the next trend and a popular one for the coming week. You could use short term loans for a wide variety of purposes which could range from purchasing an expensive phone, a laptop, to fund your dream holiday or even pay an outstanding credit card bill. These personal loans come in quite handy and usually have a tenure of less than a year. The only downside is the higher rate of interest on these loans given its duration of payment.
The primary reason for short term loans gaining popularity is the hassle-free paperwork and easy approval when compared to traditional bank loans. If you’re still new to the concept of availing short term loans or wondering what you might need it for, here is a list and the types of short term loans that will give you an overview and idea about short term loans in India.
Personal Loans: the most common and popular type of loan, referred to as the personal loan have a minimum lending amount of Rs. 30,000. Interest rates for these loans are higher than regular secured forms of bank loans. In order to avoid overdue or missed payments, the EMI is tailored according to the borrower’s salary or monthly income.
Payday loans: these loans are offered for sums even lower than that of personal loans. The sum being smaller, the cash is instantly accessible to the borrower for which the borrower needs to provide some basic documents such as their bank account number, Permanent account number or PAN and one’s salary slip. It usually gets processed within a few hours or a day and without much hassle. This instant availability of loan for smaller sums have become a popular choice for many youngsters.
Bridge Loans: what do you do in a situation when you’ve found your ideal choice of property, and you need some quick financing options to make the down payment? Availing the Bridge Loan might be your best option. Be prepared to pay a higher rate of interest in your loan and for the processing fee itself and therefore borrow wisely.
Credit Card Loans: Most of us own a credit card these days and owing one has its own advantages. Get your loans pre-approved for a short-term loan when you’re in need on the basis of your credit card history with a flexible repayment tenure that ranges from anywhere between 3 to 24 months.
PPF Account Loans: If you have a PPF account for more than 3 financial years, did you know you can take a loan against that? If you’ve saved wisely over the years, you can be eligible for a loan of up to 25% of the balance available in your account at the time of borrowing. The repayment tenure is a maximum of 3 years.
Demand Loans: In case of any financial emergency, demand loans can be availed from both banking on non-banking financial institutions against any kind of insurance policy, NSCs and small savings instruments. Loans can be availed up to 60-70% of your savings value.