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How to Effectively use Short Term Cash Loans

Taking out your first short term cash loan can be a daunting experience. You know the risks that come with debt, but you also understand that there are benefits.

Used correctly, cash loans can bridge the gap from payday to payday when those unexpected expenses show up.

To use short term cash loans effectively, reducing the risk and increasing the benefits, follow these simple tips:

Only Borrow what you NEED

When you’re applying for a short term loan, it can be tempting to add on “just a bit extra” for that new console game or a dinner at your favourite restaurant. Resist the temptation, only use these types of loans as an emergency measure.

Extra borrowing means extra interest and a higher probability that you’ll struggle to repay what you owe. That luxury purchase might seem like a good idea now, but what if other unexpected bills show up alongside your next paycheck?

Pay off Early, if you can

You don’t want to be late repaying your loan. There’s a chance you’ll incur late repayment charges, as well as additional loan interest. But what about repaying early?

In many cases, you can cut down your interest payments by repaying your loan before the final repayment date. If you receive some cash that you weren’t expecting, don’t wait until deadline day to pay off your short term loan.

Early repayment is usually a good thing, but just check quickly for early repayment penalty fees that some lenders might apply – this usually applies to long-term rather than short term loans, but it’s always best to be careful.

We don’t charge any early penalty’s for repaying your loan off early at  BingoLoans, in fact we only charge you for the time you have the money, for example;

If you took out a short term cash loan with BingoLoans for £300 over 30 days you’d pay back approx. £372, however, if you paid back that same loan 10 days after you borrowed the £300 you’d only pay back approx. £324!!! Now £24 in interest to avoid you being without a car or missing a rent payment or going overdrawn isn’t bad when you think about it.

Never Borrow more to Repay your First Cash Loan

If you’re struggling to repay a short term cash loan, don’t take out another. Instead, pick up the phone and share your concerns with your lender.

When you take out your first cash loan, you’re borrowing money and paying more back. If you take out a second loan to make repayments on the first, you’re going to owe even more. You’re constantly increasing the amount you owe, and doing nothing but storing up trouble.

Stay in control

As long as you’re sensible, using a short term cash loan can be an effective tool for money management. Before you borrow, make sure that you’ve got the money coming in to clear your loan completely.

If you’re struggling with a BingoLoan, reach out immediately, but remember also don’t overstretch yourself by borrowing more than you can afford, in the first place.

The longer you are struggling because you have overstretched, the longer your credit score will be low and your only option will always be to only be able to borrow money at high interest rates, so be a responsible borrower, the quicker you pay of your debts and the better your credit score becomes = being able to borrow money at better interest rates, which will save you money.