All of us have hobbies but some are more expensive than others. Some of us like to watch television, go for walks or spend time with family and these things tend not to cost very much money. However, there are some of us that like crafting, holidays or extreme sports and these hobbies come at a much higher price. Sometimes it can feel like you are always trying to find extra money to pay for your hobby and you may wonder whether it is worth borrowing money to pay for it. You may look at short-term loans as a possible solution. It is good to find out more about short term loans so that you can decide whether they might be a good way to fund your hobbies.
What are short-term loans?
Short-term loans are not quite what they may appear to be. Although the name implies that they are just loans which do not last long, they actually only refer to specific types of loans. There are many loans that may not last long, such as a credit card and overdraft (which can also last a long time if not repaid quickly!) but these are not included. A short-term loan refers to the types of loans where your credit record does not matter and you will usually be expected to repay the loan in the short-term. They include things like payday loans, instalment loans and guarantor loans.
These loans do not specify what purpose they are for, so they could be used to fund a hobby. However, they are often used for emergency payments because they are quick to organise, but that does not mean that they cannot be used for other things too.
Will they work to fund a hobby?
Whether this type of loan will work for you could depend on your financial circumstances. If you do want to borrow the money and have a poor credit record, then it could be the case that you will have no choice but to use a short-term loan for this purpose. However, it is always wise to look at all of your options to make sure that you are making the right choice.
Start by considering how much you need to borrow and see what loan options there are for you in order that you borrow just that amount. Try to avoid a loan where you can borrow more as you do not need more money and you will be paying unnecessarily for something you do not need. Also compare the types of loan to see whether you think that they will provide you with what you want.
Will the loan suit me?
There are a few really important things to consider when you are choosing whether to take out a loan or choosing between lenders or loan types. One is to make sure that you are able to repay the loan. It is so wise to find out how much you will have to repay and when. Then you will be able to look at your finances and work out whether this is something that you will be able to afford. As loans can vary quite a bit, you will find that you can compare them and you will see that some have quite different repayment terms to others. Therefore, you will be able to pick the one that would be the most suitable to suit your budget.
It is always worth also thinking about the lender. Think about whether you are happy with them. Consider what you might look for in a good lender and then you will be able to check this one and look to see whether they seem like they will be able to provide you with what you are looking for.
Is a loan right for a hobby?
It is also worth asking yourself whether it is worth getting a loan just to pay for a hobby. Many people do but that does not mean that you think it is the right thing to do. It is a very personal decision really. You might think that you are worth it and that you deserve a treat but you may think that you should stick to loans for emergencies or important things. It is very much a personal choice. One way to help with the decision is to calculate how much the loan will cost you. You should be able to do this either by using a calculator on the lenders website or speaking to the lender directly. You will then be able to think about whether you think that what you are buying is worth this extra cost compared to saving up and buying it. You might be happy to pay that extra or you might think that you will wait. Again it is a completely personal decision depending on where your priorities lie with regards to your spending.