Fees & Rates

While there are various programs available to assist individuals with short-term financial issues, it’s important to keep in mind that each program will have different conditions. Make sure you pay close attention not only to the terms of the loan agreement but also the rates & fees conditions.

Our goal is to ensure that you are making the best decision for yourself by being educated and understanding what you are signing. Here is what you need to know before agreeing to anything.

Rates and fees may be adjusted depending on a number of conditions.

While we can’t give you definitive answers regarding lender fees and rates, we can provide context so that you know what questions to ask later. It’s important to remember that there are many factors at play when determining these things, and one estimate is seldom representative of the final cost.

Depending on the loan, there will be different maturity dates, credit scores required, etc. The best way to find out an exact number is by contacting the lending company you’re interested in and asking what fees they charge their customers.

How Your Payments Are Calculated

To help you understand what your monthly payments might look like, we’ve compiled a few key factors for you to keep in mind:

• The interest rate is the most important factor to consider when taking out a loan. Keep in mind that these rates are often fixed, which means you’ll have regular payments at the same amount.
• The amount you take out in loans will directly affect how much it costs; lower loan amounts cost less, while higher loan amounts will cost more. For example, a loan for a couple hundred dollars will be cheaper than taking out a thousand dollar loan.
• The terms related to time can be negotiated with the lender in order to achieve a better deal. Find out what you should choose from the lender.

What Fees Does a Short-Term Loan Include?

The most common fees that borrowers need to consider are:

• Application fees – Also known as processing fees, these are what a lender charges to cover the costs of gathering and reviewing your initial application materials. This may include background checks.
• Origination fees – This fee is for the work needed to keep the process going, such as administrative tasks. It’s quoted as a percentage of the requested loan amount.
• Pre-payment fees – Check if you’ll need to make an additional fee for repaying the debt earlier than planned. Make sure you budget for that accordingly.
• If you default on any of the repayment terms we discuss, late-payment fees may apply.
• It’s important to remember that not every lender will have the same fees. It would be beneficial to compare different lenders to find one with more reasonable charges.

How to Reduce Short-Term Loan Costs

You as the borrower have some control over how much you’ll spend in total. To help you save money, we recommend:

• The most basic thing you could do is make the monthly minimum payment on time to avoid late payments. These stay on your credit report for up to seven years and impact your credit score negatively.
• If you think your payment will be late, contact the lender immediately.
• The best way to avoid forgetting a payment is by using automated tools.
• Before you make the decision to pay off your debt early, find out what the terms are. Sometimes there are discounts available, while other times there may be penalties. So don’t hesitate to ask about this before you make a decision.

In conclusion, is short-term debt worth it? You never know when you’ll need some money saved up, and having a back-up plan helps out immensely. Get in touch with our specialists at John Thomas Financial for quick financial assistance.