Short-term cash loans are a great resource when you are in a pinch. With companies like Great Plains Lending™ offering several repayment options, how do you decide which plan to choose? Consider these four questions so that you may make the most informed decision.
(1) What are your payment options?
It may seem redundant, but the first place you must start is with what you have to choose from – and this begins with why you are borrowing. There are several reasons to take out a loan. If you are financing a large amount – such as college, a mortgage, or a new car – you will need a long-term loan and payment options that fit your budget accordingly. Usually, there aren’t a lot of options there, and you are at the mercy of your lender. Student loans offer lots of repayment options, while mortgages generally offer but a few. Something to consider here: The longer the repayment period, the more you will pay in interest.
Some of these longer loans, usually mortgages, have early payoff penalties, meaning that you will actually have to pay more if you pay early. These are generally a percentage of the balance at the time of repayment.
But maybe you don’t need that kind of money right now. If you need a relatively small amount of money for an emergency or other immediate reason, that means a short-term loan is ideal. You now have a different set of payment options with a lot more wiggle room. These options are pretty straight-forward and much easier to understand.
(2) How much do you need and when?
Mortgages and auto loans are pretty cut and dry: You need enough to get the goods. With educational loans, you must consider tuition as well as fees, housing, books, supplies, and even transportation and meals. These types of loans require mountains of paperwork, and it may be weeks – even months – before you find out if you qualify.
The great thing about a short-term loan is that you don’t have to put up collateral or fill out tons of paperwork explaining why you need it. In fact, you can apply online in minutes and get an answer right away. Now, your plumbing (or other) emergency is no longer a headache.
(3) When do you want to make payments?
If you take out a short-term loan and need to make a payment on a Tuesday, but you only get paid on Fridays, this is definitely a factor to consider when selecting your payment options. In order to keep your loan on the path of success and your credit report clean, you must make all your payments in full and on time. Make sure the options you choose allow you to do this consistently. Luckily, your payments may be scheduled accordingly. Plus, you have other options along the way, such as extended terms and early payoff.
(4) How do you want to pay?
Every loan is different, and that means some great repayment options for you. Imagine how easy it would be to have your payments automatically deducted from your checking account so that you are never late in paying. With lenders such as Great Plains Lending™, you can do just that. They also offer online account management and email due date notifications.
Putting it all together
Now, go through the four questions above and answer each as honestly and completely as you can. You will find your ultimate answer there. For instance, you need to borrow under $500 for under a month to cover an emergency. You are expecting to get paid enough to cover both the loan and your other bills at the end of that month, meaning a short-term loan and repayment in full is the option that saves you the most money.
If you need a little more for a lot longer, that changes the game entirely. Now you need to revisit the options: payment amounts, payment frequency, possibility of automatic payments – and finagle accordingly. A little forethought can make your money go a long way!*The company, product and service names used in this article are for identification purposes only. All trademarks and registered trademarks are the property of their respective owners.