Some expenses take place when we least expect them. What’s more frustrating is when they came when our finances are shaky. Fortunately, a short-term loan can help us to solve this financial dilemma – be it a car repair or unexpected family vacation.
If you are among the South Africans, who have no adequate savings, then you might benefit from getting more familiar with short term loans. From understanding what a short term is to loan qualification, we’ll help you get with loan 101.
What Is A Short Term Loan?
A short term loan refers to a loan that you can pay back as quickly as possible. This type of loan helps small businesses and individuals to get quick money that is necessary to resolve their financial shortfall. Asset-based loans, fixed short-term bank loans, and payday loans are the common types of short-term loans.
The amount limit will depend on the lender. But, on average, you can borrow from R500 up to R10,000. Most South Africans prefer short term loans due to the fast funding process, where it usually takes 1 to 2 working days to receive loan approval and the funds in your account.
What’s the Maximum Loan Charge?
The National Credit Act sets the limits on both interest rates and loan fees that lenders can charge for short term loans. The maximum interest rate you need to pay is 5% per month or 30% for six months.
If you are thinking of applying for a payday loan, the maximum charge that a lender could charge is 5% per month. Other fees you may need to pay to include an initial fee, which is 15% of the loan amount if your loan is smaller than R1,000. You will also encounter a service fee of R50 and R57 VAT that is charged monthly.
How Is Repayment Made?
What’s interesting about short term loans is that they are mainly used to cover expenses and when cash flow is tight. Since you can receive cash via a quick funding process upon completing the requirements and approval, you can be sure that your financial crisis can be resolved immediately.
A short term loan typically ranges between R500 to R10,00 with a repayment period of 1 to 3 months. You can make the repayment via direct debit.
What Information You’ll Need to Apply?
If you are interested in applying for a short term loan in South Africa, you need to show a good credit history. Your credit history will be checked and analyzed by your lender. Other than that, you have to complete an online application form and provide documents such as bank account details and any other financial records.
What Are the Minimum Eligibility Criteria?
A short term loan is one of the most accessible loan options available to South because of its quick and easy funding process. But you need to meet the basic requirements to be eligible for loan application.
You need to be a South African citizen with good credit history and regular income. You must be 18 years old and above. If you are a small business owner, well-maintained cash flow is important.
Apply for A Short Term Loan Now!
When applying for a short term loan, make sure to pick licensed lenders. Friendly Finance will help you find dependable lenders. What are you waiting for? Get in touch with them and start resolving your financial issues.
For more info, do not hesitate to visit the official site of Friendly Finance.
Don’t waste time. Apply now!