Short Term Loans
Borrow £100 to £2,750 and pay it back within 12 months. Here's how short term loans work, how they compare with other ways to borrow, and how to give your application the best chance.
What is a short term loan?
A short term loan is a small, unsecured loan that you pay back over a few months – never more than 12. Through Cheque Centre you can apply for anything from £100 to £2,750, repaid over 3 to 12 months.
There are two main types:
- Payday loans – smaller amounts, often £100 to £1,000, repaid over up to three months.
- 12 month loans – larger amounts, spread over fixed monthly repayments for up to 12 months.
Need longer than a year? We can also arrange loans over 13 to 18 months. Those aren't short term loans – they're longer instalment loans, with smaller monthly repayments but more interest overall. Read more about 12 month loans.
How they compare with other ways to borrow
| Compare | Short term loan | Arranged overdraft | Credit card | Bank loan |
|---|---|---|---|---|
| Typical amount | £100 to £2,750 | Set by your bank | Your credit limit | Usually £1,000 or more |
| Repaid over | 3 to 12 months, fixed | No fixed end | No fixed end | Usually 1 to 7 years |
| Credit history needed | Doesn't need to be perfect | Usually good | Usually good | Usually good |
| Cost | Higher | Varies | Varies | Lower |
Why short term lenders can say yes when banks say no
Short term lenders usually have fewer barriers to acceptance. They tend to be more flexible about their criteria and less corporate than the big banks, and they're used to helping people whose credit history isn't perfect.
That flexibility comes at a price. Short term loans cost more than a high street bank loan, and those higher rates are what allow lenders to take on more risk. So it's worth being clear about what you're paying before you go ahead.
Other options to think about first
A short term loan isn't always the right answer. Depending on your situation, it's worth considering:
- An arranged overdraft with your own bank, if you have one.
- A credit union – a not-for-profit lender run by and for its members, often with lower rates.
- Talking to whoever you owe. Many companies will agree more time to pay if you ask early.
- Free, impartial advice from MoneyHelper if money is getting tight.
How credit checks work
Applying through Cheque Centre happens in two stages:
- Getting a quote. Lenders look at your details using a soft search. Soft searches can't be seen by other lenders and don't affect your credit score. If a lender gives you a quote, that's effectively an acceptance.
- Going ahead. If you decide to proceed, the lender carries out a full (hard) credit check. This uses much the same information, so it's usually just a confirmation of what they've already seen. A hard search shows on your credit file.
Why a hard check at all, if the soft check already said yes? We explain in our guide to no credit check loans.
Tips for a smoother application
- Stability counts. Lenders like to see the same mobile number, the same address and the same job for as long as possible – the longer, the better.
- Shop around. Getting quotes doesn't harm your credit score, and the FCA encourages people to compare before they borrow.
- Only go ahead with one. Proceeding to the full credit check with several lenders at once can set alarm bells ringing.
- Be accurate. Give your real income and outgoings – lenders check, and it's how they make sure the loan is affordable for you.
What short term loans aren't for
Short term loans are for emergencies and one-off costs – the car repair, the broken boiler, the bill that couldn't wait. Using one to pay off credit cards or longer-term loans isn't a good idea: it usually adds cost without fixing the underlying problem. If you're struggling with existing debts, speak to your lenders or get free help from MoneyHelper first.
Ready to look at the options? Compare our loans, or apply now and see what lenders can offer.
Representative example: £1,500.00 borrowed for 12 months. Monthly repayment is £154.12, total repayable is £1,849.47. Total cost of credit £349.47. Representative 49% APR. Credit broker not a lender. All loans are subject to status and only available to UK residents over the age of 18. Warning: Late repayment can cause you serious money problems. For help, go to moneyhelper.org.uk
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