Pros and Cons of Flex Loans

iQuanti: Do you need to borrow money fast? Flex loans, which are a great option for those with poor or fair credit, often have quick approval processes and are easy to apply for. Let's dive deeper into what flex loans are and their pros and cons so you can decide whether this loan option is right for you.

What is a flex loan?

A flex loan, or an unsecured line of credit, gives you flexible access to cash. The borrower is given a set limit of funds, rather than a fixed amount, that they can use as much or as little as they might need. With flex loans, you'll only pay interest on the money you borrow. Since this type of loan is unsecured, you don't have to use your car or house as collateral, and eligibility requirements tend to be more relaxed.

Pros of getting a flex loan

Flex loans are a good option for several different reasons, including:

  • Money is available quickly: Many lenders offering flex loans have a quick or instant decision process. After you fill out an application, you may get approved instantly, and can receive your funds as quickly as the same day you apply or within 24 hours.
  • Easy access to funds: With a flex loan, you can draw funds whenever you need them, making this a convenient lending option. Once you're approved, you have access to money up to a certain amount, and you'll only pay interest on the amount you borrow.
  • You don't need great credit: Although it may be hard to find a lender offering flex loans with no credit check, there are many that will consider factors in addition to your credit score when deciding whether to approve you.  These factors may include your income, employment history, and current debts. Many flex loans don't require you to have a good credit score, and you may get approved with poor or fair credit.

Cons of getting a flex loan

Here are the cons of getting a flex loan:

  • High interest rates: Since you don't need collateral, you may have to pay a higher interest rate. This is because the lender is taking a risk on giving you unsecured funds, and they may not have strict credit score requirements.
  • Risk of overspending: Because flex loans give you a source of money you can withdraw from as needed, you may be tempted to spend more than you can afford to. Make sure to keep track of what you're spending and remember that you have to pay interest on the amount you borrow.

The bottom line

Flex loans are convenient, easy to get, and a good fallback option for people who can't rely on a steady income throughout the year. They're also a great option for special projects, like home repairs, where unexpected expenses can pop up. You don't need great credit to get approved, so consider flex loans if you need access to cash right now.  

Notice: Information provided in this article is for information purposes only. Consult your financial advisor about your financial circumstances.

Source: iQuanti, Inc.

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Categories: Personal and Family Finances

Tags: financial services, loans, personal finance