In the world of personal finances having a solid credit score while applying for a short term loan can help you with the process. For availing these loans, there are various short term loan apps available in the market that you can explore.
One of the leading and trending short term loan apps these days making its way into the financial world is FatakPay. Although this is a relatively new name in the market, with its unique offerings and easy to use app, it’s surely making its way in the financial world.
Moving forward, as we said, having a good credit score can have a huge impact on how these short term loan apps can help you get better loan amounts and offers. Before we dive into this, let’s try to have a look at what a credit score is and what are its major benefits.
Understanding Credit Score
A credit score is a numerical representation of your credit worthiness. It is further categorized into different categories such as Poor, Fair, Good, Very Good and Exceptional. The credit score starting from a range of 300-579 is poor, from 580-669 comes under fair, 670-739 is good. 740-799 is very good and 800-850 is exceptional.
Based on these representations your short and long term loans are approved and rejected. As we have already mentioned in one of our previous blogs that you can refer for having a better understanding of credit score and how it can impact your loan approval.
What are Short Term Loan Apps?
Moving forward with this blog we are going to have a deeper understanding of these short term loan apps available in the market and how one can leverage these applications. As we have already mentioned FatakPay is one such short term loan app available in the market, here is a detailed view.
These short term loan apps are designed in such a way that with minimum documentation, and traditional banking process, these apps offer the users with a short term loan approval for a small amount of funds. These funds are approved and made available to the user instantly for immediate use.
As we said there is no hassle of the traditional banking process of standing in long queues and having a pile of paperwork, this is a relatively easier process. This allows the user to have access to the funds immediately for the financial emergency.
Furthermore, depending on the short term loan app that you are using the amount of loan approval can vary. In most cases the initial amount of loan approval starts with five thousand and can go up to a higher level depending on the frequency of repayments.
Impact of Credit Score
Moving forward, let’s have a look at how having a good or bad credit score can impact your short term loan app.
From the above mentioned criteria of credit score, if a person with a credit score of 480 enrolls on a short term loan app, the credit score lies under the poor category. Now this can indicate several points such as: the frequency of repayment is not stable, the person doesn’t have enough credibility and financial reputation of having a good repayment process. Hence, this can cause a delay in the loan approval process or even a denial of loan amount.
However, if a person with a credit score of 675 enrolls with such a short term loan app, the chances of the user getting an instant approval for loan amount is higher as the credit score comes under the good category. Similarly, higher the credit score, higher is your reliability and the app along with the partner bank are more confident with your repayment stability.
Although having a bad credit score is not a guarantee or final verdict of the user not having a stable source of income. Hence, there are various ways to improve your credit score for getting a fast and quick loan approval.
Along with this, a user with higher credit score is eligible for getting better offers and benefits on the short term loan app as compared to a user with a low credit score loan. Therefore, it is advisable to build a good credit score for availing maximum benefits and offers.
Building Good Credit Score
Here are a few points that one can consider for getting a strong credit score.
- Ensure there are no pending bills or repayments which can cause a bad financial reputation. Timely bill repayments is one of the most important and common points to be considered for building a good credit score.
- Another factor to consider is to shop more often. Yes, shopping more often and leveraging your cards and online mode of payments can help you have a good credit score.
- Keep a check of your credit report. Ensure there are no penalties or pending bills which can have a negative impact on your credit score.
- Don’t apply for numerous credit cards, instead stick to your necessary 1-2 credit cards only. Too frequent applications of credit cards can also have a negative impact on your credit score, hence avoid applying for too many credit cards.
Concluding Points
From the above mentioned points it is evident that having a good credit score can have an impact on the functioning and offers on the short term loan apps as well. Along with this, the points mentioned above can be used to avail a good credit score and better offers on the short term loan apps.
Among other existing apps, FatakPay is one of the trending short term loan apps that you can leverage and get instant short term loan approval within minutes, without the hassle of documentation.
For more information get in touch with our experts today.
FAQs:
1. How can short-term loan apps help improve my credit score?
Getting short term loans can help you get a better credit score, as with easy and timely repayment of the loan amount, you can build a better credit score. This process can help you slowly build your score and avail the benefits of a good credit score.
2. Are there risks involved in using short-term loan apps for credit improvement?
No, there are no risks involved in using short term loan apps for credit improvement. The only requirement is timely repayments.
3. What factors should I consider before using a short-term loan app to boost my credit score?
To boost your credit score consider- timely repayments of the loan amounts, timely bill payments, limiting your credit card applications and monitoring your credit report.
4. Can using multiple short-term loan apps simultaneously affect my credit score?
Yes, this can have a negative impact on your credit score, hence it is important to limit the use of such short term loan apps.
5. How long does it typically take to see improvements in my credit score?
It can vary depending on your initial credit score. However, it usually takes 3-6 months in general to see some significant changes in your credit score.
