financetom
Personal Finance
financetom
/
Personal Finance
/
Take a look at these five short term loans that can meet your money needs in an emergency
News World Market Environment Technology Personal Finance Politics Retail Business Economy Cryptocurrency Forex Stocks Market Commodities
Take a look at these five short term loans that can meet your money needs in an emergency
Jul 31, 2018 9:29 AM

Loan could be a very useful tool, if planned and aligned as per your financial goals. However, you may face a situation when you don’t have much time in hand to plan your borrowing and there is an urgent need for money. This is where short-term loans come handy and bail you out from unannounced financial emergencies like salary delay or medical urgencies. These are basically personal loans that are made available instantly for a short tenure. Based on the need, there are various types of short term loans offered by banks and financial institutions that you can avail during a financial emergency.

Live TV

Loading...

Payday loan

There was a need for short-term loans in India with tenures smaller than the typical personal loan. Hence, payday loans are becoming popular. The interest on a payday loan could be higher in comparison to the personal loan or loan against credit card. However, it is instantly available and you can borrow small amounts. You just need to upload your salary slip, bank details, PAN card copy, and a few other details, to get the loan amount credited into your bank account within the same day of submitting the application. The tenures on such loans can be just a few days or a few months, unlike a personal loan whose tenure is typically 1-5 years.

Loan from an employer

There are many companies which allow their employees to take a loan either at low interest rate or with no interest for a short period. Such a loan is usually adjusted against your salary every month or as per the company’s norms. Before you apply for a loan from your company, exercise due diligence and consider the tax applicability factor.

Loan against credit card

You can avail an instant loan against the credit card you are using. You can get the loan through the card company on the basis of your credit history, repayment capacity and credit limit. A credit card loan is pre-approved or pre-qualified. These loans are granted at a rate comparable to personal loans rates. You can get a higher amount than the cash withdrawal limit available on your credit card. You get a flexible repayment tenure normally ranging from 3 months to 24 months.

Loan against mutual fund

Some banks and lenders allow you to pledge your mutual fund units to get a bank overdraft instantly. Loan against mutual fund is provided against qualified funds. The loan is allowed against both debt funds as well as the equity-oriented fund. The most important benefit of a loan against mutual fund is that even an applicant having no credit history can apply and get this loan easily. Unlike other short-term loan products, this loan is secured in nature, but at the same time the processing time required is very little.

Loan against Public Provident Fund

If you have a PPF account, then you also take a loan from the third financial year to sixth financial year of opening the account. As compared to a personal loan, this kind of loan can be taken at lower interest rates. A loan against PPF is charged 2 percent higher than the interest earned on the balance in the PPF account and is to be re-paid in 36 months tenure. The interest charged will be 6 percent more if the loan repayment crosses 36 months. The amount of loan you can avail is capped at 25 percent of the balance at the end of the second financial year preceding the year in which the loan was applied for.

Things to keep in mind before you apply for a short-term loan

It is important that you apply only for the loan amount you need urgently and which you are sure that you would be able to repay within the scheduled repayment period. Applying for a higher loan amount can unnecessarily put pressure on your other financial objectives.

It is always better to save money and build a contingency fund to meet emergency fund requirement.

Disclaimer: The views and investment tips expressed by investment experts are their own and not that of the website or its management. Users are advised to check with certified experts before taking any investment decisions.

Source: Moneycontrol.com

Comments
Welcome to financetom comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
Related Articles >
Research Alert: CFRA Maintains Buy Opinion On Shares Of Apple Inc.
Research Alert: CFRA Maintains Buy Opinion On Shares Of Apple Inc.
Mar 22, 2024
08:20 AM EDT, 03/22/2024 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows: The U.S. is suing AAPL, accusing it of monopolizing the smartphone market by citing that AAPL makes it difficult for competitors to integrate with the iPhone, thus raising prices and...
Research Alert: CFRA Raises Opinion On Shares Of Lululemon Athletica To Strong Buy From Buy
Research Alert: CFRA Raises Opinion On Shares Of Lululemon Athletica To Strong Buy From Buy
Mar 22, 2024
08:15 AM EDT, 03/22/2024 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows: We maintain our 12-month price target of $550, based on 37.9x our FY 25 (Jan.) EPS estimate and below the company's 5-year average forward P/E multiple of 42.7x. We maintain...
Research Alert: CFRA Lowers Opinion On Shares Of Stellantis N.v. To Hold From Buy
Research Alert: CFRA Lowers Opinion On Shares Of Stellantis N.v. To Hold From Buy
Mar 22, 2024
08:25 AM EDT, 03/22/2024 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows: We increase our 12-month target by $2 to $30, based on a '25 P/E of 4.7x, a justified premium to its historical average forward P/E of 4.3x. Our estimates are...
Research Alert: CFRA Lowers Opinion On Shares Of Stellantis N.v. To Hold From Buy
Research Alert: CFRA Lowers Opinion On Shares Of Stellantis N.v. To Hold From Buy
Mar 22, 2024
08:30 AM EDT, 03/22/2024 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows: We increase our 12-month target by $2 to $30, based on a '25 P/E of 4.7x, a justified premium to its historical average forward P/E of 4.3x. Our estimates are...
Copyright 2023-2024 - www.financetom.com All Rights Reserved