How To Apply For a Short Term Loan

By Allison Martin

Are you in a financial bind and need quick cash? A short term loan can help you make ends meet and alleviate stress related to financial worry. 

Unlike other loan products, they are accompanied by a loan term of up to 1-year and should mainly be used for minor unexpected expenses, like auto repairs and medical fees. 

Short Term Loan Benefits

Short term loans offer a few key benefits to cash-strapped consumers. 

Fast Cash

Most lenders offer same or next-day funding. So, you won’t have to sit around for days waiting for a loan officer to approve or deny your application. You can apply in minutes and receive an instant decision. 

If you’re approved and accept the loan terms, you could have cash in your account by the close of business or the next business day. 

Less Interest Paid Over the Life of the Loan

Loans with lengthy repayment periods may seem like a better deal, mainly if the monthly payment is low. However, an extended loan term also means that the lender has more time to collect interest from you.

With a short term loan, the repayment period won’t span beyond 1 year. You can pay even less in interest if you make larger payments. 

Inquire with the lender before signing on the dotted line to confirm you can pay off the loan early without incurring prepayment penalties. 

Easily Accessible

If you’re at least 18 years of age with a steady source of income, you shouldn’t have trouble finding a short term loan. Keep in mind that the lower your credit score, the more you’ll pay in interest if the lender uses your credit rating to determine the loan terms. 

Several lenders offer no-credit-check short term loans. They often have a high interest rate since the lender is assuming more risk. The good news is that they’re unsecured and are far more appealing than secured loans that require collateral. This means you won’t lose your home, car, or other valuable possession if you’re unable to repay the loan. 

What Are Your Options? 

You don’t have to suffer in silence until your next payday rolls around. Consider these short term loan options to give your wallet a boost. 

Traditional Banks

You probably won’t find a short term loan at a traditional bank or credit union. If you happen to stumble upon a financial institution that does offer them, expect to undergo a credit screening and wait for 1 to 3 business days to hear back.

Another drawback to a short term loan with a traditional bank is the application process. You can apply online, but the lender may require you to upload personal and income documentation instead of syncing with your bank account to pull the information it needs. This can be tedious and time-consuming. 

Also, expect your credit score to weigh heavily in the decision-making process. A low score means an expensive loan, and the cost of interest could outweigh the benefit of the loan. 

Payday Loans

Payday loans make it easy to get cash in hand. You can apply with an online payday lender or visit a physical location. However, they aren’t the best option and should only be used as a last resort. 

Unfortunately, payday loans come with excessive interest and fees and are usually due on your next payday. The lender will present your postdated check to withdraw the funds they’re owed from your account. If the payment is returned due to insufficient funds, you’ll incur additional fees from the payday lender and your bank. 

Most borrowers are unable to repay the loan when it’s due, which leads to a perpetual cycle of costly extensions and even more debt. 

What if the balance remains unpaid and the account is sold to a collection agency? Your credit score could take a hit if you’re unable to pay in full or make an arrangement with the debt collector within 30 days. 

Credit Builder Loan

Credit builder loans are another viable short-term loan option. You’ll get the cash you need and help improve your credit rating, which is a win-win for you. 

They’re designed for credit newbies or individuals who want to boost their credit health. So, even if banks have said no to a traditional loan, you may get a yes with a credit builder loan product. 

While most credit builder loans require you to pay the balance in full before accessing the funds, MoneyLion does the exact opposite. We understand how important it is to get the cash you need when you need it and take an unconventional approach to lending with our credit builder loan product.

If you sign up for a MoneyLion Credit Cuiler Plus account, you can get a credit builder loan of up to $1000. Plus, you’ll have access to a portion of the loan proceeds (maybe even all of it, depending on your finances) right away. 

The remainder of the funds are held in an interest-bearing Credit Reserve Account and released when the final payment is made. In the meantime, you can watch your credit score grow as you make timely payments each month. Even better, MoneyLion reports account activity to all 3 credit bureaus – Experian, Equifax and TransUnion – so you can receive the benefit of a higher credit rating across the board. 

There is a $19.99 fee each month for the Credit Builder Plus membership. But it’s well worth the investment considering the interest you’ll save on future debt products with a higher credit score. The membership also gives you optional access (at no additional cost)  to zero-fee banking, managed investing and no-interest cash advances. 


Imagine having access to an interest-free loan at the tap of a fingertip.

Get your fee-free, 0% APR loan of up to $250 by signing up for Instacash. It only takes a few minutes to set up your profile, and you’ll know how much you can advance right away. The best part is that the moment you request an advance in the app, funds are sent to your bank account right away. 

Worried you won’t qualify because your credit score is too low? Don’t be. There are no credit checks, and MoneyLion won’t report loan activity to the credit bureaus. 

Get a Short-Term Loan Today! 

Don’t settle for the first loan offer that comes your way. Consider a Credit Builder Loan or Instacash advance from MoneyLion to meet your needs. They’re far more affordable than traditional bank loans and payday advances, and you could have the funds in just a few minutes. 

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