Know APR for your Short-Term Loan to Avoid Fraudulence

General

Many people have different types of financial needs. There are days when someone needs instant money, but has no savings because of low income or daily wages. These unavoidable circumstances can be education fees for kids, medical bills, instant utility bill payments, etc. However, some people need immediate funds to buy new clothes for a friend’s wedding, or a concert ticket, etc.

Needs can vary, but for such needs when you start begging your parents, relatives, and friends for money every time, they finally start ignoring you. Here comes the role of short-term loan. If you’re above 18 years old and have the capability of paying back because you have a full-time or part-time job, then you can seek help from lenders who give small loans.

These loans are small in amount and you don’t have to wait in queues for hours to get approval. A small formality has to be completed online where you submit some documents and fill up an application form. The money is transferred directly to your bank account and repayment is also done online. Nobody tortures by coming home or nobody calls you with harassing calls. As long as you repay instalments on time, you’re good to go.

LoanPig provides short term loans in the UK. With advanced technology, everything is dealt online and al your information is secured with them. They believe in transparency with their customers because they aren’t any loan sharks, therefore all terms and conditions and interest rates are published on their website www.loanpig.co.uk. Generally, some lenders pay in 2-3 days, but LoanPig pays within 4 hours to the borrower, if there is no problem in documents.

All short-term loans are easy to avail, but the biggest problem is the interest rate. Generally, you may have seen that banks provide long-term loans at a decent interest rate and that is why people approach them more. It is simple maths, if you’re paying a loan in a year you pay a larger interest rate, but when you have the chance to pay it in long tenure you pay less interest rate. Every lender or financial institution lends money to gain profit through these interest rates.

Other than the interest rate and other charges, we have an Annual Percentage Rate. APR is the interest rate along with additional fees that are charged over the year.  In simpler words, it is a number in the percentile that calculates the total loan over the year including interest and other charges like late fees, admin fees, lawyer fees, etc.

APR for short-term loan is higher than long term loans –

  • If the tenure is more than 12 months, then APR is calculated by adding the total interest and other charges and then dividing them to create a yearly average.
  • If the tenure is less than 12 months the total interest and other charges are multiplied to give the average for a year.

Every time you don’t need to be paying higher APR with payday loans. The best way to calculate your APR for any loan is by using the APR calculator on the publisher’s website. This is because every publisher has different ways of calculating APR. Know the APR of your loan so that you can compare it with other loans as well. Lenders always have different repayment options, which can be chosen if you find the instalment amount higher.

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