17Feb/19

Short-term personal loans

Short term personal loans are issued to a borrower for a very short period of time. It is also paid back to the lender immediately. In this arrangement the borrower and the lender enter into a short term contract. Short term personal loans can be obtained from commercial banks and other financial institutions. In short term personal loans interest rates charged is higher because of the short duration of the loan. Also a limited and small amount can be borrowed in case of short term personal loans.

Interest Rates In Short Term Personal Loans:
The most important aspect of short term personal loans is the interest rates offered by the lender. Generally higher interest rates are charged in short term personal loans because the time span of the contract is very short. Another reason for higher interest rates is that the lender does not require any security so they charged high interest rates.

Short term personal loans are offered worldwide. The interest rates offered by the companies depend on the credit history of the customer and the time taken by him in the repayment of the loan.

Credit Range Of Short Term Personal Loans:
In short term personal loans, limited amount of loan is offered because the time span of the contract is very short. Banks and financial institutions do not offer more than 15,000$ to 20,000$ if the time to pay back the loan is fore years or less. But for the advertisement purposes loan of 1000$ to 5,000$ is also offered by the lending companies.

Advantages Of Short Term Personal Loans:
Short term personal loans are very beneficial if a person is in need of urgent cash. The whole process of short term personal loan is quick and easy. The borrower and the lender enter into a short term contract with each other. Also the lenders are not interested in collateral security against short term personal loans. They are only concerned about good credit and financial history of the borrower.

Disadvantages Of Short Term Personal Loans:
The biggest disadvantage of short term personal loan is very high interest rates as compared to the other types of funding available in the market. Smooth availability of short term personal loans attract people strongly because it provides them financial relief at that time. But it may become difficult for them when time arises to pay back the loan.

Tips And Advices:
It is highly advisable to the borrower to carefully investigate all aspects of the contract. He should make a thorough market research before entering into any contract with the lending company.

The borrower must also take into account the current market situation and the interest rates prevailing in the market. He should negotiate with the lender for the best interest rates that suits his requirements. Also consult loved ones and friends before making a decision of borrowing money from the lender.…

10Feb/19

Debt financing for business

Business debt financing has become a major source of providing cash resources to the business. Whether the entrepreneur wants to establish a new business or he wants to invest more to provide firmness to his existing business, Business debt financing plays a vital role. Business debt financing may be in the form of providing additional capital by the owner, lending from the bank or any financial institution or investment in the business by the third party.

Who Can Provide Finances?
Stability of any business depends on the amount of cash it has either in hand, at bank or in the shape of highly liquid assets such as short-term investments, bonds etc. In case of any financial crises generally there are three parties who can provide finances to any business which are discussed below briefly:

Equity Investment By The Owner:
The most appropriate and safe way of providing finances to the business is the capital investment made by the owner out of his personal savings.

Investment By Third Party:
Business can also get cash resources from the investment made by any third party into the business.

Long-term And Short-term Loan:
In case when the above two options are not available to the owner he is forced to take a loan from the bank or any other financial institution.

Small Businesses:
In case of small business debt financing is not an issue. The owner can use so many options instead of taking a loan or involve ant third party into the business. He can arrange cash resources from his personal savings and brought it into the business in the shape of capital. If this option is not available to then he can go for short-term loans.

Obtaining a long-term loan is also a reasonable option if the entity in interested in the purchase of any asset. But it may involve interest costs which may be a burden for small businesses.

Now in the modern world the use of credit cards has become a routine activity for small transactions. Small businesses can also get benefits from the use of credit cards instead of going for any other option.

Large Businesses:
As the size of business expands, the amount of debt accumulates more and more and business need large amount of cash to meet his financial demands. In this case the entity cannot survive without business debt financing. If the scale of the business is large then the best option available is to for a long term loan.

Lower monthly installments and low interest rates can help the entity to manage his overall financial requirements. The company can also use his assets as a collateral security against loans.

Use Of Credit Cards For Business Transactions:
Although the credit cards have so many benefits but it is not an advisable option. High interest expense is an alarming problem in usage of plastic money. The business cannot afford high financial costs. But it is still used by numerous entities for day to day transactions.…