Why Not All Short Term Lenders are Created Equal

Why Not All Short Term Lenders are Created Equal

December 8, 2020
Why Not All Short Term Lenders are Created Equal

If you are in a bit of a bind and looking for a quick loan, you need to do a bit of homework. Not all short-term lenders offer the same deal. It is important for you to understand what they offer and what they expect.

There can be big differences between lending companies. You need to pay attention to the interest rates, the payback rules, and what happens if you miss a payment.

Keep in mind that these lenders are a business, which means they are in it for a profit. Some more than others, so it’s important to know who your lender is and how they do business.

Interest Rates

Interest rates will be a big aspect you want to look at. Some of these places will charge substantially higher interest on a small loan than others.

All reputable lenders will post their interest rates on their website or in their store location. If no rates are posted, or they are not a direct lender, go to the next one on the search results. Never use a company that does not post their rates clear and conspicuously.

It’s also a good idea to know what your state laws allow before you choose a lender. A lender who isn’t licensed by your state, can, and will charge higher interest rates. They do so by using a tribal or offshore company which will not follow state guidelines.

Many state laws also put consumer protection policies in place to make sure the lender isn’t taking advantage of the borrower. Check your states consumer finance division to find a licensed lender list.

Payment Schedule

Some places may have very tight restrictions on when they expect the payments. Be sure you can make these payments successfully to avoid a collection issue. Many short-term loan products are designed to pay the loan back within 30-90 days.

There will be penalties involved for late or missed payments. These can be in the form of late fees or return charges, so make sure you understand the repayment schedule before you take the loan.

Limited Funds

Most of these lenders will have a limit on how much money you can borrow. They are designed to paid back within a short amount of time so borrowing large sums at higher rates isn’t a good idea. Unless you have a concrete plan for getting the money paid back on time, you don’t want to have a huge debt hanging over your head.

If you only need a few hundred dollars to get you to your next paycheck, you should be fine. If you are applying for a payday loan, you should be able to make the payment back in full within a couple of weeks.

Bad Credit

While having bad credit isn’t the worst thing, it will preclude you from obtaining a bank loan. A payday loan is an acceptable way to get the money you need, but its important to find a reputable lender.

Millions of people have less than desirable credit and successfully use short-term loans to help them in a bind. It’s highly recommended to make sure and find a licensed lender within your state. It’s also a good idea to check their reviews and their BBB rankings. This will help you figure out who has done a good job of servicing their customers.

Lending Bear

Lending Bear is a short term loan company that gives you options. Quickly becoming one of the most reputable lending companies in the Southeast, they understand that people need help fast. With over 5,000 5-star reviews and counting, many borrowers have given Lending Bear their stamp of outstanding approval.

They make it easy to apply, either online or in-person. Most applications can be completed in under 30 minutes. They also offer pawn and title loans if you have collateral to use for your loan. Cash when you need it, fast and friendly! Contact us today with any questions.