In this article, we will explain short term loans and how these loans work, features of cheap short term loans, and what you should avoid. A short term loan is one which is paid back soon after you receive it, often from your next paycheck. They are intended to be a short bridge to cover emergency expenses like a car repair, late utility bill, medical expense, and so on. These loans are often called payday loans because you pay it back on your next pay date.
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Features of Cheap Short Term Loans
These loans are fee-based loans. This means there is a set fee for the loan that is determined by the amount of the loan. They are not intended to be used like a credit card or more traditional loan that you pay back over time, and that has a ‘minimum’ payment amount.
If you roll over or extend your loan, the fees and penalties can be quite high, and the cost of the loan can become too much for many people with tight budgets. There are other less expensive loan alternatives including credit cards if you have one or more.
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One of the best features of cheap short term loans is you can qualify for one even if you have bad credit, but meet other basic criteria, such as have a steady job, a current bank account and so on. More than half of all people applying for cheap short term loans are approved. Check your state government website to see any limitations that may apply in your state of residence. There are states that do not allow these types of loans.
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