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The Complete Guide To SMS, Short-term Loans
The Complete Guide To SMS, Short-term Loans

The Complete Guide To SMS, Short-term Loans

Are you facing a financial emergency? Unpredicted situations in the form of costly car repairs, roof leaks, or medical emergencies can happen to literary everyone. Instead of asking your family members or trusted friends for financial help, you can apply for a short-term loan.

These unsecured credits are available in a variety of forms, requiring no collateral and stellar credit scores on the part of applicants. As long as you have a regular income, online lenders would be more than willing to provide you with the financial support you desperately need.

Nevertheless, short-term, SMS loans are known for their high-interest rates and short payback period that you need to consider prior to applying for one.

The following guide explains everything you need to know about the types, application process, interest rates, and benefits of such financing.

How short-term loans work?

These unsecured loans are obtained by individuals requiring temporary financial support, particularly people who aren’t considered eligible by traditional lenders like the banks.

Short-term credits are supposed to be paid off within a short period of time, ranging from a minimum of six months to a maximum of one year.

In some cases, the term can be extended to as much as eighteen months, but any term longer than that is classified as either medium-term or long-term credit.

Although the application process varies across moneylenders, the usual procedure of getting a short-term credit involves finding an online or storefront lender and passing the required credit check.

If the moneylender finds your request suitable, you’ll be provided with an offer, which you’re supposed to either accept or reject. Read more about the characteristics of short-term credits in detail.


When looking for such loans, both individuals and businesses are provided with a multitude of alternatives to choose from. For instance, merchant cash advances are a commonly used form where the lender provides the required sum of money to the borrower in return for a certain percentage of each sale the borrower makes in the course of the payback period.

Another popular option is the line of credit, which allows borrowers to use funds whenever necessary until they reach the set limit. The loan is paid off in the form of monthly instalments, whose amount depends on the sum of money you’ve borrowed.

Fortunately, the Annual Percentage Rate (APR) of credit lines isn’t abnormally high when compared to other forms of financing.

In addition, payday loans are probably the most popular variant of short-term credits, mostly obtained by people who cope with financial emergencies. These loans involve no intricate eligibility criteria, hence being uncomplicated to get.

Anyhow, the interest rates of payday credits are abnormally high and these are supposed to be paid off along with the borrowed amount at the same time, not through monthly instalments.

Therefore, a large number of states regulate the sum of money people are allowed to borrow from such moneylenders, as well as determine the maximal interest rate these professionals can charge to borrowers.

Moreover, some states have prohibited the use of payday loans, as most of the borrowers have ended up in the red. Many people can’t afford to pay back the borrowed amount, hence borrowing another payday loan to repay the first one.

Before they know it, they find themselves deep in debt.

Ultimately, online or SMS credits have become increasingly popular as short-term financing options. The application and approval process of SMS loans is performed via an SMS or online with just a few clicks.

The breakneck evolution of technology has made the SMS application method too old-fashioned, but the term is still used to refer to the online method of credit application.

This form of financing provides individuals with the required sum of money only minutes after the request has been approved by the online lender.

Interest rates

Short-term loans are infamous for the high-interest rates, which mainly depend on their type, the creditworthiness of the borrower, as well as the lender you choose. The payday credits involve the highest interest rates in favour of undemanding eligibility criteria.

Therefore, potential applicants are strongly advised to conduct in-depth research on different types of lenders, offers, and interest rates. Despite your financial desperation, refrain from accepting the first offer that comes along the way in order to avoid getting into debt.

Application process

There’s nothing complicated in the application process for short-term loans, as it involves a couple of straightforward steps. First of all, you are recommended to check your credit score so as to assess the likelihood of being considered as an eligible candidate.

Afterwards, make sure you look for reputable online lenders by checking the myriad of reviews by former clients who share their experiences of collaborating with such professionals.

Once you choose a suitable lender, you’ll be required to collect the necessary paperwork in order to submit the application. After gathering the required documents, you can finish the last step of the application process online.

The final thing to do is wait for approval, which can happen within the same day of applying. The borrowed sum of money is usually wired to one’s account in a matter of days.


Short-term loans have proven to be beneficial in numerous ways to people who require quick access to cash, as well as aspiring borrowers with poor credit scores. These financing tools provide clients with fast funding time, which is crucial in financial emergencies.

Furthermore, these loans require no collateral, hence not obliging clients to risk some of their valuables in the event of not paying the sum off. Also, individuals aren’t required to have a stellar credit score to be eligible as long as they provide proof of regular income.

These offers involve no long-term commitment, usually no longer than a year. Some moneylenders even provide clients with flexible payment plans that fit their preferences, except for payday loans.

Bottom line

There’s no reason to fear financial emergencies.

Short-term loans are the solution you need!

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