Short Term Loans

Instalment lenders provide short-term unsecured loan options with a simple online application over 6 months or less. Compare our FCA authorised and regulated UK direct lenders and brokers for the best online options around.

What is a short term loan?

A short term loan also known as installment loan is typically repaid through scheduled periods of payment (usually weekly or monthly.) This can include a huge range of purposes, with the most common being mortgages.

How do Instalment loans work?

Instalment loans work by allowing a borrower to repay a loan over a longer period of time. This means that once a borrower has agreed with a lender on an amount to be borrowed, the lender will then decide in how long the borrower will have to repay the loan as well as which dates the money will leave the account. This should have a smaller impact on a monthly budget and allow borrowers to maintain a higher standard of living. This means that every month a borrower repays the loan, they pay off a part of the loan plus interest. Given that the interest on an instalment loan is charged on a daily basis, over time the repayments will get smaller and far more manageable meaning a borrower may well be able to repay their loan early.

How do repayments work?

Instalment loan repayments are incredibly structured and, essentially, an agreement will be made between the lender and the borrower on the amount to be borrowed, how the repayments will be split and when the monthly repayment will be. This allows a borrower to plan their finances well in advance, and have far much more control over their long term finances.

Can instalment loans help with bad credit?

If you are able to make the repayments on your instalment loan you could actually improve your credit score. However, if you are unable to make the repayments this will damage your credit score further.

What are the advantages of instalment loans?

Fixed interest rates: This means borrowers know exactly what to expect over a set time period. Lower monthly payments: Thanks to the longer terms of repayments, traditionally payments for a mortgage are far lower than other types of loans. Improves your credit rating: If you pay off your instalment loan on time then it can help improve your credit rating Borrowing more money: Given the way that instalment loans work and that they are typically offered for longer periods of time. You can generally borrow more money which makes them perfect for mortgages. Spread the total interest: As every month you pay off a portion of the loan and interest, you are able to gradually pay off the interest in far more affordable payments. Planning ahead: As you will know precisely how much money you have to pay back monthly, you can create a clear budget and plan ahead.

What do you need to apply for an Instalment loan?

For an instalment loan you need to be: Be over 18 years old Be a permanent UK resident Have a permanent UK address Be in employment Hold a UK bank account and debit card

Why should you take out an instalment loan?

Reasons for taking out an instalment loan could include: Financial emergencies Increasing the value of the property Debt consolidation Dental and medical treatment Emergency travel expenses

What are the disadvantages of instalment loans?

Stringent Checks: Given the nature of instalment loans and the amounts being lent, most lenders will be extremely cautious and will carry out thorough checks before lending any money. Prepayment may not be allowed: Most lenders will charge a penalty if you wish to pay off the loan early.

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