Low APR Short-Term Loans

If you absolutely must take out a short-term loan, you want as low of an Annual Percentage Rate (APR) as possible. People generally take out short-term loans for debt consolidation, home improvements, furniture, rent deposits and other personal matters that require a significant amount of money. Even the lowest APR still means you will pay interest fees, so make sure the loan is for good reason.

APR

The APR is calculated using all of the fees associated with the loan, including any upfront fees, documentation fees, discount points, application fees, underwriting fees and closing fees. When comparing financial institutions, typically the less fees, the better.

Qualifications

Your credit rating, employment status, repayment history and debt will be factors in determining your APR.

Unsecured Versus Secured

If you are a homeowner, you can usually qualify for a secured loan and a lower APR, by using your house as collateral. If you become delinquent, you could lose your home. If your credit is in excellent standing, you may qualify for an unsecured loan, though the APR will be higher.

Truth in Lending

The Federal Truth in Lending Act requires lenders to be completely forthcoming about their interest rates, including APRs.

Comparisons

Each lender calculates fees differently and may not include all fees in the APR, which can skew the loan amount. When shopping around, always look for hidden costs.

Resources

• Loans with Low APRs
• Low-Interest Personal Loans