5 Benefits of Short Term Personal Loans
Published on : September 02, 2021

The need for funds can crop up at any time in your life and the needs could be varied depending on your personal situation. Facing a cash crunch, especially when you are a youngster starting out on your own is nothing new. It could arise for any reason and the crunch may just be temporary. All you need is a short term solution to tide over the crisis and you will be just fine. 

The needs could vary from paying your course fees, a medical emergency, your wedding expenses, a dream vacation, a phone you fancy, an electric car, an investment opportunity or anything else.

Obviously, you would need the process to be as simple, quick and convenient as possible. Here is where a personal loan puts its hand up and says, “ Here I am, the quick fix for your funding issue.”

What is a short term personal loan?

Personal loans are basically unsecured loans that require no collateral. Short term loans are loans that are repaid over 1-2 years. As the name suggests, these are taken to tide over a temporary crisis. Moreover, you can take it for any purpose you want.

What are the benefits of short term personal loans?

You can list the benefits of short term personal loans under the following heads –

  • No collateral
  • Ease and speed of processing
  • Manages the emergency
  • Improves credit score
  • Cheaper than credit cards

No collateral 

Can you imagine the pain of being caught in an emergency situation and being asked to pledge assets to get a loan? It can be quite a nerve-racking experience, especially in a medical emergency. Young working professionals who are a year or so into their career scarcely have assets to pledge while their financial emergency is real. Here is where a short term personal loan steps in as the knight in shining armour. They do not ask for any collateral which makes it convenient for a vast majority of borrowers.

Ease and speed of processing

It is a fast-paced environment that we live in and customers expect their needs to be met immediately. Nobody has the time or patience for tons of paperwork or the luxury of waiting for days and weeks for the loan to be disbursed. Short term personal loans score high on this count. The application is filled online and the mandatory documents are uploaded. The approval process is completed electronically and the amount is credited to the mandated account. The entire process takes between 24-36 hours. This gives people in a cash crunch emergency the opportunity to explore this solution as it can give them sufficient relief. A traditional loan is not so quick nor is it convenient as it involves a mountain of paperwork. The short term personal loan with its ease, speed and sheer customer satisfaction scores over other options when it comes to an emergency.

Manages the emergency

A short term personal loan helps you to tide over your emergency quite quickly. Whether it is a business need or a family emergency or a course fee that needs to be paid or a big-ticket purchase, you can choose a short term personal loan for all your needs. If you exercise some financial prudence, you can easily compare the rates offered by various lenders and get a personal loan that suits your requirements.

Improves credit score

Taking a personal loan and repaying it on time will help you to improve your credit score. Short term loans are easier to manage via EMIs. The likelihood of delayed EMIs is lower. This will help you to take another personal loan in future.

Cheaper than credit cards.

Personal loans are cheaper than credit cards. It makes more sense to opt for a short term personal loan than to use a credit card if you want to manage your debt better. Credit cards charge 2-3% per month on the outstanding balance which works out to 24-36% annually while personal loans are comparatively cheaper with the upper end close to 24%. Personal loans are structured and hence are usually repaid with fewer delays/defaults while credit card debt cans are usually kicked down the road.

Now that you have seen how short term personal loans benefit borrowers, let us figure out how you can get your hands on a personal loan should the need arise.

How do I know if I am eligible for a personal loan?

It is quite simple. You are eligible for a personal loan if you are an Indian citizen or resident over the age of 21 years and earning more than Rs 30,000 net income on a monthly basis.

How do I go about getting a short term personal loan?

At LoanTap, getting a short term personal loan is like eating a piece of cake. All you need to do is to fill up an online application and upload the following documents-

  • PAN Card
  • Aadhaar Card/Driving Licence/Passport
  • Salary Slips of last three months
  • Bank Statement of salary account for the last six months

The team at LoanTap will evaluate your application and the appended documents. If everything is in order and you have a decent credit score, your loan will be approved and the amount disbursed to your mandated account. The entire process from start to finish will be completed within 24-36 hours.

LoanTap offers personal loans from Rs 50,000 – Rs 10,00,000 for tenures ranging from six months to three years. The annual interest rates start from 18%. You can select your tenure and fix your EMI based on your convenience. You can choose from a slew of repayment options and pick the one most suitable for your situation. 

Once you have serviced the loan for six months, you are free to repay the loan without incurring any prepayment penalty.

Sounds easy, doesn’t it? If you are ever faced with a financial emergency, there is no need to panic at all. You don’t need to call up your friends and family for the money. All you need to do is to visit the LoanTap website and fill in the application. We are there to help you find the right product tailored to your situation. So, whether it is a business crisis or a favourite gadget or a dream vacation or a medical emergency or a hair transplant or putting down money for your dream house, we have you covered. Remember, whatever be your financial need, we are just a few taps away.

Related article – Which Personal Loan is better for you? – Long term or Short Term

Should I Choose a Long-Term or a Short-Term Tenure for my Loan?