Loans for Short Term: Everything You Need to Know

When it comes to loans, everyone has their approach. Some borrowers prefer long-term loans that don’t make a huge dent in their salaries, while others want to get these loans paid as fast as possible. If you’re one of the latter group, loans for short term suit your preferred time frame. 

These loans don’t involve a drawn-out process, so let’s learn more about them.

What this article covers:

What Is a Loan for the Short Term?

A short-term loan is a small personal loan that you can repay fast. Its amount typically ranges from $300 to $5,000, and its repayment period can be as short as 16 days and up to a year (or even two years). Generally, the repayment terms are flexible, and the fees are fixed.

The reason people seek short-term lending could be that they don’t want to be in debt for years. It could also be that they don’t need much cash, just enough to cover an unexpectedly high utility bill, emergency repair, home renovation, or medical bill.

Suppose you want to buy new home appliances. You can take out white goods loans and pay them over a long time. But if you’re in a hurry to pay your debts, the better alternative is to turn to loans with short terms!

loans for short term

After all, you can fill out an online application in minutes, get matched with a lender fast, and receive your funds the same day or the following one!

Considering its small amount, this is usually an unsecured short-term loan. So, you won’t need to secure the loan against an asset (like your house, car, or else). Nonetheless, the lack of security means there’s a high-risk level for lenders, which is why they might charge relatively high-interest rates.

Do I Qualify for These Loans?

To receive short-term money loans, you must meet a lender’s criteria of assessment. Needless to say, it’ll differ across lenders, but some basic requirements are to:

  • Be at least 18 years old
  • Be an Australian citizen or permanent resident
  • Receive a sufficient regular income
  • Have a bank account

How to Apply for a Short-Term Quick Loan

You can apply for the loan by following these three basic steps:

Submit an Online Application

The application process is quick and 100% online. All you have to do is enter your preferred loan amount and term, choose the reason you need the loan, and add your personal and bank information with the needed documentation. The information you’ll need to provide is the following:

  • Full name
  • Qualifications and education
  • Gender
  • Physical or residential address
  • Contact details, including your mobile number, telephone number, and email address
  • Occupation (by providing job history, pay slips, or other documents)
  • Bank account details
  • Bank statement data for the 90 days before your application
  • Evidence of your borrowing history
  • Credit requests you’ve made before
  • Tax returns for the past two years
  • 100-points of identification

short term loans

Wait to Get Matched

As a lender provider service, we look for a reputable lender who’d be willing to offer you the loan you need. This process could be as quick as a few moments! Afterwards, we’ll connect you with that lender so that you can deal directly with them.

Sign the Loan

The lender will evaluate your loan application and consider different financial indicators, such as your overall income, employment status, recent spending, outstanding debts, and more. This is to determine whether they can approve your application without putting you in a worse financial situation or not.

If accepted, they’ll draft a loan contract and let you review it. We recommend you do so with a financial or legal advisor. You can sign the loan electronically if you accept its terms. Then, the lender will reach out to you to agree with you on the funds’ method of transfer, and you’ll receive them the same day or in a couple of days!

Why Get a Loan for the Short Term

If you’re wondering why you should apply for such a loan, we’ll list a few perks of these financial products.

Easy Acceptance

Have you been denied loans because your credit score is less than perfect? Perhaps you’re unemployed, or on Centrelink benefits, so you want a loan for job seekers or loans for casual workers. Luckily, you can still get a short-term money loan!

If your credit history isn’t high, we can connect you with lenders who are willing to offer you a second-chance loan! They consider factors like your current income and employment status rather than solely focusing on your past finances.

As for Centrelink benefits, lenders can consider them as viable income sources if they’re stable and consistent, such as parenting and child care payments (for which we’ll suggest a single parent loan), family tax benefits, and disability, age, veterans’, and carer’s pensions.

short term loan

Fast Funding

You probably want the money for an emergency, which is why you’ll like online lenders. The loan application process is speedy, and you’ll get paired with a lender fast. Even better, you might get your loan in a day or two! This way, you can have your car or kitchen pipe leak fixed fast.

Flexible Repayment Terms

Do you want to repay your loan in two months or spread it out over 24 months? Are you more comfortable with weekly, fortnightly, or monthly repayments? Short-term personal loans in Australia allow you flexible repayment dates, and you can sync your repayment schedule with your payment cycle.

Set Repayments

These loans are generally small. As long as your loan is a Small Amount Credit Contract (SACC) under $2,001, you’ll pay a fixed monthly rate. So, your repayments will be consistent, which should give you peace of mind!

Concerns About Short-Term Credit Loans

Before you get these loans, be aware of the following:

High Costs

These loans are mostly unsecured, which is why they involve high risk for lenders. This risk is heightened in the case of bad credit history. To compensate for it, lenders charge relatively high fees. But rest assured that the Australian Securities and Investment Commission (ASIC) has capped fees on SACCs to be a maximum of:

  • A 20% establishment fee on the loan amount
  • A 4% monthly fee
  • Default fees and enforcement fees
  • Government fees (if applicable)

short term loans australia

Sketchy Lenders

Not all short-term lenders in Australia are reputable and trustworthy. Avoid any lenders who offer short-term guaranteed loans because they breach responsible lending regulations and loans with a 15-day repayment term, as they’re banned by the ASIC.

Make sure lenders are accredited and have many positive reviews, or let us do the job (although we always recommend that you double-check).

Final Verdict

If you’re after some emergency cash for a necessary repair or unexpected bill, loans that are paid over a short term are a solid option. Their online application processes enable fast transfers.

The average loan amounts are $300 to a few thousand dollars, and you can repay them in a short period (starting at 16 days). This way, you can get your loan out of the way in no time!

Was the guide helpful? Check out these extra resources to delve deeper: