A long term loan is taken out by people who want a larger loan with the flexibility of making smaller repayments over a longer period of time. As lenders are becoming more cautious after the financial crisis this type of loan is more likely to be approved. This is certainly the case for lower income earners and people with lower credit scores. If you are in this situation you may not have any other choice, but for other people considering applying for this type of loan it is important to know the disadvantages.

The biggest drawback of long term loans is that the total interest paid out over the life of the loan will be more than for a standard term loan. They also come with different fees and charges, which in some cases can be considerably more that a regular loan. The final disadvantage is that while you may be able to borrow more your financial situation could change in the future restricting your ability to make the repayments. Most importantly, before signing up for any type of loan it is important to make sure that it suits your needs.