Are 'Instant Loans' a Good Idea?

There are many private institutions that offer what are often referred to as 'instant personal loans' and 'payday loans', but care needs to be taken when applying for them because you'll be required to supply a whole lot of personal information, and this caution is particularly pertinent if you apply online.

A good and very simple way to check out an online bank's reputation is to enter its name along with the word, 'complaint' in a search box, and see what kind of results come up. If the name that you entered doesn't come up at all, then recheck it's name but without the word 'complaint' and then see if anything either positive or negative appears.

Every establishment that offers 'instant personal loans' or 'payday loans' should very clearly display their terms and conditions from very early on in the process and if you feel for even one moment that information is intentionally being concealed, or that questions are being avoided , then move onto another lender right away because there are lots of online lenders that are eager to lend money, so you should only proceed with one that you're really comfortable with.

There are several very good reasons for taking out an 'instant personal loan' and one of them is that if you repay it on time that you'll improve your credit rating; but don't take one out just for this purpose however because the interest will be high, and there are several far better ways to improve your credit rating.

That said, if you do pay the loan back on time, if and when you need another loan it will be considerably easier to get it approved, and you'll more than likely been given more time to repay it.

A large number of people are now seeing their previously good, and often excellent credit ratings, being destroyed because of the ongoing financial crisis, so many lenders of short term loans are becoming far more flexible than they were just a few short months ago, and even if you're credit rating is appalling you'll more than likely get a loan, but expect the interest rates to be higher.

The best reason to take an 'instant personal loan' however, is when you suddenly get a lot of bills come in at the same time and many of them are final demands and can't be delayed. An additional reason of course is if you get taken sick, or you or a member of your family suddenly need to go to the dentist or wherever, and it won't wait.

We previously broached the subject of high interest rates, so perhaps it should be mentioned how high the interest might be. The answer to this is that you won't feel like you've been mugged if you pay the loan back on time, but if you let it roll over several times then the accumulated interest might easily reach 200% or more, depending on how long you leave it unpaid.

One very important advantage to these short term loans is that when the lenders say, 'instant loan', they generally mean that you'll get your loan within twenty four hours, and the maximum is not likely to exceed forty eight hours, unless there's a week-end involved.

To quickly summarize;

You'll most often get an 'instant loan' within twenty four hours.

Bad and even terrible credit should not cause any kind of problem.

Pay the loan off by its due date, or expect to pay a large amount of interest.

Don't take out an 'instant loan' just to repair your bad credit.

Only use an 'instant' loan to cover immediate and unexpected debts.

Source by Michael Redbourn

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