WHAT IS A SHORT TERM LOAN?

A short-term loan can simply be defined as a type of loan that is acquired for personal or business purposes. A short-term loan requires the principal amount to be paid with interest before due date. They have a deadline to be paid and this is usually within a year after acquiring the loan from the lender.

For most small businesses, and start-ups in need of capital, acquiring a short-term loan is the best course of action. This is because, small businesses as well as most startups usually don’t qualify for credit line from the banks. Short term loans can act as a lifeline.

Short term loan lenders usually grant amounts that range from $100 & can go as much as $100,000. Individuals with temporary cash flow problems are also eligible to apply for short term loans. Short term loans are easily accessible.

WHAT ARE THE CHARACTERISTICS OF A SHORT-TERM LOAN?

As per its name, short term loans are usually expected to be paid off very quickly. In many cases, the duration for a short term loan to be paid off is usually between six months to a year. Short term loan repayment durations in certain cases can stretch up to 18 months. Any form of loan expected to be paid off after 18 months can be classified as a medium term loan or a long term loan.

Long term loans however, can be expected to be paid between just over a year and to 25 years. The payment plans for some short term loans are very flexible. They allow you to pay back at your own pace. These types of loans do not come with a specific due date. However, there are always terms and conditions the borrower must agree to before the lender approves of the loan process.

THE DIFFERENT TYPES OF SHORT TERM LOANS

1. A merchant cash advance. Even though this type of short term loan is a cash advance, it still is in a form of a short term loan. In these instances, the lendee makes the loan payments by allowing the lender have access to the lendee’s credit information.

2. A line of credit. A line of credit is similar to using a business credit card. A credit limit is usually set and the business or start up is allowed access into the line of credit whenever they need it. Monthly instalment payments are usually made for whatever amount is being borrowed.

According to how much line of credit has been accessed by the business or state up, monthly payments may vary. One major merit of a line of credit compared to business credit cards is that, line of credit comes with a lower Annual Percentage Rate (ARP).

3. Payday loans. One major characteristic of a payday loan is that it is very easy to obtain. Payday loans are emergency short-term loans. They are very common to acquire the fact that, even high street lenders offer this form of a loan. However, the major disadvantage to acquiring this form of loan is that the entire amount of the loan as well as its interest is expected to be paid back in one large sum on the due date. The lender can simply take the loan repayments from the lender’s bank account using a continuous payment authority. Another disadvantage of this form of loan is its high-interest rates. This makes it sometimes difficult for some borrowers to meet their deadlines.

4. Online or installment loans. The process of acquiring this short-term loan is done online. This process is usually smooth and easy from the application process up to the approval process. Once finalized, the funds are wired to the bank account of the borrower. The borrower will first have to agree to a series of terms and agreements before the lender realizes the funds.

MERITS OF A SHORT TERM LOAN

Short term loans come with many advantages for the borrower and some of these include;

1. Short time frame for incurring interests: in most instances, short-term loans are required to be paid off within about a year however, there are lower total interest payments incurred. Long term loans have a significantly huge interest rate.

2. Quick funding time. Short-term loans are usually considered to be less risky compared to long-term loans due to the fact that it has a short maturity timeline. This means that the borrower doesn’t have to go through too many hoops in order to acquire a loan from the lender.

3. Ease of acquiring. One major advantage of a short-term loan is due to the fact that the requirements to obtain a loan is quite easy to meet. Small businesses, start ups as well as individuals with low credit scores consider this form of loan a lifesaver. The reason short-term loan processes are fairly easier to obtain is due to the fact that the amounts are relatively smaller compared to long-term loans which take a while to process loan applications.

DISADVANTAGES OF SHORT TERM LOANS

Although not many, the main disadvantage of a smaller loan is the fact that it usually provides small amounts of money to the borrower. This is however due to the fact that the timeframe of the loans is expected to be paid soon so that the borrower won’t go through the stress of huge monthly payments.

Short-term loans are essential to most small businesses that are in need of capital as well as individuals. Individuals who have to make big purchases usually opt for this form of loan so that they do not burn through their life savings. Many people have different reasons for taking short-term loans. Some might include, buying a new car, or paying for the services of a real estate lawyer when trying to close a deal on a new property.  This is what a friend of mine who lives in Markham did.  He went for a short loan to pay for closing costs with a real estate lawyer in Markham

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The high cost of high interest loan

This article explains why a company needs to be careful when going for a loan. The loan you get can make or break your company. Very often when a company is desperate for financing they don’t pay that much attention to the interest rate that is charged on the loan that they want to have. For example, loan express services can be expensive and not designed for businesses.

The higher the interest rate the higher the monthly payments. And the longer it will take to pay off the loan. This can affect the cash flow of the business significantly. Businesses go bankrupt not because they don’t have assets but is because they don’t have liquid cash and cannot sell the assets fast enough to meet their legal financial obligations.

This is why the following article is very important and every small business owner that is considering a loan should read it. The article first appeared in https://articlebiz.com/

Are high-interest loans leaving you on a never-ending spiral?

Strategic business growth begins with well-managed financials, and managing your loans is no exception. While paying off loans can be a source of great stress for many business owners, tying up your financial loose ends can mean the difference between endlessly owing money to your lenders, and elevating your company to the next level.

The question is this: are your accounting systems and processes up to standard? If not, chances are you are paying much more on loans than you should be.

Our team at Blueprint CFO can help! Here is one example.

When the Blueprint CFO began working with a local building supplies contractor client, the firm had three outstanding loans: Loan #1 (40% APR), Loan #2 (55% APR), and Loan #3 (25% APR). Because the firm had to make weekly payments on these loans, they had continued cash flow issues. The company also found themselves in a Catch-22, stuck in a never-ending cycle of acquiring loans — with even higher rates — to pay off the previous loans. There seemed to be no end in sight.

In auditing our client’s financials, the Blueprint CFO team found that the company’s books weren’t properly prepared, which led them to experience a number of issues, including their loan-related predicament. While the company utilized Quickbooks Desktop to issue invoices and bills, the firm did not have a cohesive record of its expenses, assets, equipment rentals, etc. Moreover, their bank accounts had not been reconciled for three years.

The Blueprint CFO team responded to this in a number of ways.

First, we improved automation and created an up-to-date view of relevant data by transferring the company’s numbers from Quickbooks Desktop to Quickbooks Online. This allowed our client to have a clearer view of their records so we could work towards a new financial strategy — one that would truly lead to growth and profitability.

We then built high-integrity financial statements and records, which increased bank confidence in the company. This led to acquiring a loan from a Regional Bank with a LIBOR rate of + 2%, interest-free for the first year.

As a result, the company could pay off all outstanding loans, saving them $150,000 in 2021 interest expenses. With their new financials, our client also now qualifies to apply for their PPP loan payoff as well as the new California Grant.

All in all, our rockstar accounting team at Blueprint CFO was able to rebuild the client’s books and reconcile their bank and credit card accounts, resulting in hundreds of thousands of dollars worth of savings. We can help you do the same! With our signature Profitability Roadmap formula, our all-star team of accountants at Blueprint CFO can help you make sure you have the systems and processes in place to set your business up for success.

Jim Downes is a Fractional Chief Financial Officer and the Founder of Blueprint CFO, a data-driven accounting & CFO services firm based in Orange County, California. A forward-looking strategist, Jim and his team provide a competitive advantage over typical CFOs. Leveraging data, they go beyond the numbers to make their clients ever more profitable.

Article source: https://articlebiz.com. You can read the full article at https://articlebiz.com/article/1051878036-tie-up-your-financial-loose-ends-the-importance-of-managing-high-interest-loans

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Looking for a quick loan

Quick loans are loans that are approved very quickly, and the money is paid into the borrower’s account very quickly. There are a whole number of companies both online and offline that provide quick loans. Such services are described as express loan services or loan express services.

One other advantage of such companies is that they are not like mainstream companies that require so much from you in order to get approved for a loan. These types of loan express companies provide what are called bad credit loans. This means that if you need a loan from those companies you do not need to have very clean credit.

People get back credit when they default on their credits or loans given to them in the past. The loan that they took is registered with a credit bureau. And the credit bureau keeps a history of how well the account is run. Whenever a person applies for a loan the lender will call for the credit history of the person who applied for the loan.

Such loans are called express loans. These are instant online personal loans that can give you the funds you need swiftly. There’s often no far better choice as you’ll generally have the money within an hour when you need cash.

These loans can promptly provide you with the funds you require, without limitation on how they can be used. Unlike typical credit rating applications, the financing application procedure, approval, and funding for immediate advance online are super-fast. Rate and benefit are what make these kinds of fundings different, making them best suitable for the way most Canadians live their hectic lives these days.

Continue reading to find out more concerning the advantages of express loans on the internet and how you can get accepted for them by a licensed, trusted industry leader.

Naturally, when cash is tight, Canadians turn to fast finances for quickly, very easy accessibility to the funds they need.

When Canadians require emergency situation lendings, these loan companies come to their rescue. Some of them describe themselves as loan express companies. Your money needs are immediate, and your cash lending institution should be equally as fast in authorizing you for the funds that you need. Online fundings take simply mins to get as well as get you the cash money you need the very same day.

Another thing is that it does not take long to complete the online application for an express loan from a loan express company. It probably may not take longer than he takes you to read this article. Because their application forms are very structured and designed to make it easy for customers to apply for the loan.

With a loan express fundings, you can pick your loan amount, and applying is simple because the finance application is finished online, and you can apply for the loan 24/ 7, day or night.

On-line express loans with immediate authorization provide you the funds you require using e-transfer within 5 mins after being accepted.
After that, the loan is paid off based upon your chosen repayment plan and schedule as agreed in your loan application.

As a business, long express companies are committed to transparent financing, allowing you to understand the full price of borrowing, with no surprise fees. It’s really that straightforward.

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Loan Express The Fastest Ways To Get A Loan Online

Express loans or loan express services or express car loans are immediate loans you can get on the internet. Individuals can get the funds they need quickly, securely as well as efficiently. There’s frequently no better option than express loans as you’ll normally have the cash within an hour. If you require cash quickly and also cannot wait express loans can be an actual lifesaver.
These sort of express loans, be it express payday loans or express car loans can rapidly provide you with the funds you need, without constraint on exactly how the funds can be utilized. Unlike standard credit loan applications, the process, approval, and also are super-fast. The fast rate of processing, as well as the benefits they provide, are the hallmark of these types of loans. This makes them an excellent loan suitable for Canadians with busy lives.

Read on to learn more about the benefits of the types of express loans available.  There are even companies called loan express companies that will provide you with quick loans.  The article will also touch on how to apply for such loans.
When you least anticipate making an expense on let’s say a household item, that is when you must make a purchase. One moment everything seems to be going great, and all the equipment in the house is working well. Then the next moment all of a sudden you must buy something for the home because something broke.

Possibly your refrigerator made a decision to quit working, or your heater just quit working in during the harsh cold Canadian winter. You may also need money to spend on your kids. One of your kids just came home and said that I wanted to register for this sport. And registration is tomorrow. What are you going to do if you don’t have the money?
The only option might be to look for a loan. And because the registration for the sport is happening the next day you don’t have a choice than to look for a quick load. This is where quick loans or express loans come in. Many Canadians rely on these types of loans to help them to overcome such immediate challenges.
When you need money that quickly you need a lender that can work with you to get the money quickly. When Canadians require emergency loans, they require loan companies that can act very fast. This is what made express loan companies very popular online.

Online express loans, be it express payday loans or express car loans or express personal loans are the fastest option available to someone who needs money like yesterday. You can get approximately five thousand dollars in less than one hour when you apply.
Many people who will apply for such loans are grateful for having the money that quickly. This enables them to make the purchase or make the expenditure that they are required to make as quickly as possible. In the time it takes to read this web page, you can finish your funding application and get approved. That’s the power of quick or express loans.

One other advantage of express loans is that it is based online. In other words, you can apply for a loan online evening if it is in the middle of the night and get your money the next day. Therefore you can apply for an express loan online twenty-four seven days or night.
On the internet lending with instantaneous approval give you the funds you need by means of e-transfer within 5 minutes after being authorized. The funding is then paid to you instantly based upon your chosen payment method to receive the money.

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5 Ways To Manage Your Finances

Finance

Managing your finances in a way and manner that gives you the ability to afford things is very important. Most people sometimes work so much for money but they end up losing it to nothing important because they place very little value on money. Successful people always place value on money in the sense that, they ensure that they invest their money into places that can yield even more money for them. Every billionaire begun with saving something. Giving savings a try is a bold step for most people since it could be their ticket to become financially comfortable. There are many reasons why a person should focus and put in efforts in being financially stable.

You Never Know What is Coming

Imagine you wake up tomorrow and you have a sharp pain in the stomach. You go to the hospital and you need immediate surgery to manage your health complication. Unfortunately you do not have enough money for the surgery and your insurance company will take a while in processing your insurance for the surgery. What will you do?

Having some money stashed away will give the opportunity to pay for the surgery needed to avoid future problems. Many people have been victims of such situations  different scenarios and it is very prudent that you prepare for what is coming because, something always comes up either positive or negative.

Be In The Position to Help Others

This might not be priority but it would be very nice to be able to assist others with their financial problems especially if they are family. Having the ability to offer kind gestures to people and support them financially gives you the chance to get such favors returned in case you are in need.

 

Being financially independent gives you the chance to contribute to other’s future and every good deed that you do comes right back to you. Many people have lived and survived only on the merit of other people’s kindness and such people might have never had the chance to attend college. Some people have also been able to sponsor themselves through many stages in life due to their financial independence.

You Can Actually Afford Things

There are people who can not afford almost anything but the truth is, it is very nice to afford nice things you know? Things that you like and things that will make your life easier. When you are financially independent. You can be able to buy things that they need or want. You live in a house and your lawns grow so fast. Your mower gets damaged and you can not even get a new one because you do not really have the cash for it. Here is what you can do. You can save up money for it if you did not do that from the beginning and your lawns will be trimmed up to your liking.

Why You Should Save

Investing resources into savings makes your personal life and mental wellbeing stable. You do not overthink or become anxious over any financial issue just because you can not manage it. Becoming financially sound and seeking financial help in the form of loans can also help you to overcome the  financial barriers that you are being faced with. Beginning your financial journey with the right  attitude and reaming disciplined in saving up money is very wise. Also, investing your money into places and businesses which can bring you  profits is very helpful.

Getting the Right Help

If you are already financial stable but have encountered a hinge in your financial life. You can always seek help. You can ask for a loan with flexible interests and payment plan. All that is needed is to ensure that you meet all the payment methods so that you can get the same help next time. Getting the financial support you need when you are financially unstable can help you create avenues to make money.

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Personal Loan Insurance is Good Protection

When it is time to borrow money for some reason, most of us usually think of some friend or family member who we hope will be able to help us. It is not an easy thing for some people to do when it comes to asking a relative or friend to help them out of a bad spot concerning money.

Cash withdrawal from a credit card could be an option, but borrowing charges from credit cards are very high when added to the monthly interest charged to the balance on the credit card. A lack of funds may be easier to alleviate by securing a personal loan.

If you decide to use a personal loan it may sometimes be a little rough to make the payments, so you may want to think about taking out personal loan insurance.

Personal loans are used for the purpose of consolidation of debts, paying education costs, repair bills and also vacation costs.

You may know that personal loans, just like credit cards, can be secured or unsecured|Personal loans can be secured or unsecured, just as credit cards are|You can get a personal loan that is either secured or unsecured just as credit cards are|Just as your credit cards are when they are sent to you, personal loans are given on a secured or unsecured basis}}}. Secured personal loans have a form of collateral to back them up, that is why they are named as such. If you obtain a secured loan, that means you have put a personal possession on the line to guard against non-payment, so personal loan insurance will be a good thing to have in this circumstance.

The determined cost of personal loan insurance is usually arrived at according to the outstanding balance on your loan and the type of insurance you take out, but you do gain peace of mind in the end.

The three types of personal loan insurance to choose from are personal loan death insurance, personal loan disability, and involuntary unemployment.

Up to a certain dollar amount will be paid by personal loan death insurance if one of the individuals on the loan dies. In that case, the nominated person on the policy will be paid in full up to the maximum dollar amount or assured amount.

The type of personal loan insurance coverage most often purchased is disability plus. With this coverage you will be paid the monthly personal loan repayments up to a certain dollar amount and you will also receive a percentage of your loan amount each month to help with your cost of living expenses.

Read More: Personal Loan Insurance is Good Protection