Every loan comes with terms, including the interest rates and the timetable for repayment. Before you borrow money you have to do the long-term financial planning and plan out how quickly you can get out of debt. Long term loans and short term loans both have their uses, their benefits, and their drawbacks.
Long Term Loans
Most longer termed loans tend to be mortgages or otherwise secured with collateral. It is possible to get long term personal loans longer than 60 months.
The uses for these loans are often for debt consolidation, to refinance existing debt, or for life events and health issues.
The monthly payments tend to be much more reasonable than with a shorter term loan. On the other hand, you will still pay more in interest than with a smaller loan.
You will also need to be careful of prepayment penalties, origination fees, and other costs that are built into your loan repayment.
Remember to never borrow more than you need, and always repay every loan as quickly as you can. Every second you spend in debt costs you money.
Short Term Loans
These loans have higher interest rates or APR, but don’t let that scare you. A higher rate on a smaller sum, for a smaller amount of time, doesn’t make them a bad deal. They are often beneficial to many borrowers, because they stay in debt only briefly, and can walk away paying a fraction of the interest of a mortgage or other long term loan.
If you are trying to build up your credit, these loans may not be helpful. Depending on the lender, they may or may not report to the major credit bureaus.
This is good for people with poor (or no) credit, but not so much for upwardly mobile people who want to establish a strong history of debt management.
Pick Your Terms
At PR Title Loan we charge the same interest rates regardless of the repayment schedule. You can choose to pay your loan off quickly to save the interest, or you can take up to 15 months!
As always, all new customers get no interest or fees charged for the first 30 days.