Getting an online short term loan

Everyone can be caught short sometimes near the end of the month with an un expected bill or urgent need for money for a car repair or vets bill. Small value short term loans are often called payday loans. For larger amounts of money which require security, bridging loans are still available even now within the credit melt down.

Payday loans are often granted without a credit check or credit scoring process and they rely on the lender getting enough control of the bank account of the person when their pay day comes. Typically the lender takes £25 fee for every £100 lent.

Secured lending on your home - review of lenders

Bridging loans are secured short term loans on property. Usually they involve a 1% lenders fee and a 1% brokers fee, and have rates from 1% to nearly 2% per month. Bridging loans usually have a maximum term of around 9 months before the repossession process starts. Its often hard to get bridging finance without some sort of exit route in the form of a formal mortgage offer, or contract of sale for another property.

Both types of short term loan are expensive in fees, and for a bridging loan there will be lawyer’s fees and buildings insurance will need to be in place. Also if the bridging loan involves taking a second charge on a property already with a first charge mortgage on it, the second charge lender will require the consent of the first charge lender, as the risk to the first charge lender is increased as the amount of equity in the property will be reduced.

Bridging loans are great for purchasing property at auction where using the auction property as the security is difficult. Bridging loans will always require a credit check which will leave a footprint in the borrower’s credit file, but some short term loans or payday loans can be done without a credit check.