An installment loan is a personal loan borrowed for a term of up to 24 months and requires a minimum of two periodic payments. The customer pays back the loan in small fixed amounts, every month, so the loan is settled at the end of the term. Each installment payment includes the loan principal and the interest charges. The interest rate on installment loans vary considerably and depends on the lender, borrower’s credit history, current income, and state laws. Installment loans are a long-term financial solution.
DirectLoansLenders offers independent service and does not represent any lender. This puts us in the position to offer the best loan deals that borrowers can trust. Let’s examine installment loans and how they work.
Are Online Installment Loans The Same As Cash Advance Or Payday Loans?
No, these are distinctly different types of loans.
Payday Loans are offered with high fees that translate to a high annual percentage rate (APR). Payday loans are due on the borrower’s next payday and must be paid back in full, including fees. If the client rolls over a cash advance loan month after month, rates become much higher than on installment loans.
Installment Loans have a longer term – from 2 to 24 months. The APR is still pretty high, but the longer repayment period and small fixed monthly installment payments make them more affordable for most borrowers.
Why Do People Choose Online Installments Loans Over Payday Loans?
Installment lending is in the medium to high range of annual percentage rates. People who borrow from installment loans lenders do so to cover short-term financial need, and only up to an amount they can afford to repay. Borrowers prefer short-term installment loans over payday loans because they offer more flexibility in terms, larger loan amounts, lower monthly payments that fit into the budget, lower APR.
What Is The Real Cost Of Installment Loans
An installment refers to a payment made regularly, on a weekly or monthly basis, to settle a debt. The actual amount depends on the terms of a particular loan. Here’s a worked example where the interest rate rounds up to 36%. However, this is for illustrative purposes only, as the actual amount a borrower pays on a $5,000 loan over 24 months may vary. Find more examples here.
Loan Amount: $5,000
Loan period: 24 months
Number of payments: 24
Monthly installment: $295.24
Total interest: $2,085.69
Amount repaid: $7,085.69
Online Installment Loans APR And Penalties
More than half of Americans have a sub-prime credit rating. The actual rates they pay for personal installment loans can range from 6.63% to 225%. In addition, lenders may charge late payment, non-payment and collection fees if the client defaults. It’s essential to understand how these fees apply. Avoid them by paying the installments on the due dates.
Applying For An Installment Loan Online!
We connect borrowers with direct lenders, once one decides to get a loan. Applicants may select loan amounts between $1,000 and $5,000 and complete the online form, which requires ID, address, income and bank details. One of the lenders will usually make an offer almost instantly! The offer includes approved loan amount, APR, installments, total amount due, dates, any extra charges, and penalties. Once the applicant e-signs the agreement, the lender deposit loan amount directly to a bank account. Safe, Secure, Fast and Easy!
Installment Loans For Bad Credit
Lenders we work with may still approve people with bad credit for online installment loans. They perform a soft pull credit check (known as a no credit check), so the borrower’s credit history is not the most important approval factor. Lenders check the overall financial background of the applicant, and the main qualification requirement is a borrower’s stable income. The APR will be higher in this case. We urge everyone to think twice before applying for a loan with up to 255% interest./p>
Online Installment Loans FAQ
Q: How much money can I borrow?
A: DirectLoansLenders offer online short-term installment loans up to $5,000.
Q: What are installment loans alternatives?
A: Borrowers may consider online cash advance loans or personal loans.
Q: Which states have no APR cap on installment loans?
A: Alabama (for loans of $2,000+), Delaware, Idaho, Missouri, New Mexico, North Dakota (for loans of $1,000+), Ohio, South Carolina (for loans of $600+), South Dakota, Utah, Wisconsin.
Be careful with the money
Online installment loans may look like a safe way of borrowing, but that ignores the danger of careless use! Having money can be tempting, but stay calm and spend it wisely. These funds are borrowed and should be paid on time! We protect clients and promote responsible use of loans. We insist consumers read all terms of a loan offer before signing it. Consumers may contact our customer service any time for help and details.