Sometimes, you need money fast and without complications. Short of asking friends and family for money, the easiest and most convenient thing to do is to get a cash loan. Now, that can come with its pros and cons, but we’re going to talk about all of them. Let’s talk about everything you need to know about a cash loan, like what it is, what are the advantages, what are the disadvantages, and of course, whether or not you should get one.
What Are Cash Loans?
Let’s start by defining the term – cash loans are unsecured loans you get in cash. The fact that they are unsecured means that you do not need to provide security through collateral, but it also can mean that you get a smaller amount of money. But even though an asset is not required to use as collateral, a credit check can be performed to determine your eligibility, as well as affordability checks, ID checks, and others.
How Much Do You Get?
As for the amount, as I mentioned, it’s not going to be very high, because of the aforementioned reasons. The other thing you should be aware of is that they aren’t offered for long repayment periods, either. That makes this kind of loan suitable for some expenses, but not for others. For example, if you want to make a larger purchase, you would need a secured loan, instead.
A cash loan would only provide you with £100 – £5000, but in practice, you will mostly be able to get around £1000 to £2000. The repayment terms are in line with the amounts received, and range from 1 month to 36, for a loan that is larger.
What Are The Benefits Of Cash Loans?
You have free reign over the loan
A cash loan you get on the spot can be very useful especially in cases of emergency, but you can use it however you want. That’s one of the major advantages of cash loans. There is no one tracking how you spend the money; you use it however you want, no questions asked.
You can use the cash immediately
The instant nature of the loan enables you to get the cash immediately and use it for any financial emergencies you may have. The process is simplified especially to ensure quick pre-approval. Compared to traditional lending solutions, a cash loan can allow you to solve all of your issues as quickly as possible.
What Are The Drawbacks Of Cash Loans?
You don’t have a long time to repay the loan
The short repayment term can be a problem for many borrowers, as it can limit you tremendously. You would only have around 3 to 6 months to repay a loan of around £500 to £1000, while a smaller loan of around £100, for example, might come with a repayment term of only one month.
The amounts borrowed are small
Since you receive the loan in cash, the amount you can get won’t be very high. That means that if you have massive purchases to make, this won’t cover them entirely, or maybe not at all. A cash loan is best suited to small, urgent expenses.
In conclusion, a cash loan can actually be very useful, because it grants you money you can use to cover an urgent expense in an emergency situation. You never know when you will need money fast, and an instant cash loan can ensure you get the money. Of course, as with any other financing option, there are also drawbacks you need to consider, such as the fact that you don’t get large amounts of money or that you need to repay the loan fairly quickly.
That means that you need to think about whether or not a cash loan is the right option for you or if you would be better off searching for a different financing solution for your needs.