You may be wondering what exactly are the specific details that are behind the term, “installment loans.” It is not very familiar or that common, but it’s an excellent tool for people who need a certain amount of credit. It offers you a specific payment plan that repays the loan until completion and the loan is repaid. We are about to share with you what exactly installment loans are and how they can help you.
This type of loan gives you the opportunity to borrow a set amount of money in the format of a loan. Now unlike revolving forms of credit which include, lines of credit and credit cards, you decide the exact amount you need before you borrow. After you have borrowed the funds you will have to repay the installment loan over a period of time that you and the lender have agreed too. The payments are planned in advance and typically they are made on a monthly schedule but there are variations to this. Each payment that you make towards your loan is an installment payment, which is why these types of credit are known as installment loans.
We will continue in this report and share with you the common formats of loan many people use in their daily lives that can be considered installment loans for bad credit. There are different types and the most common include, vehicle loans, house mortgages and also student loans. We will clarify and explain the different types of these loans as you continue below.
When people choose to take out an auto-loan they typically will have monthly installment payments from a range of 12 to 96 months. Not all credit lenders will offer loans in this range but this is a common amount. Now loans that have longer terms typically will have lower monthly payments, and also higher interest rates. When it comes down to it, you will be paying more money for a car with a 4-year loan rather than a 3-year loan.
Mortgages are installment loans that people use to purchase a home. Typically these mortgages are paid over a period of 15 to 30 years of monthly payments. Often times, some mortgages will come with a guaranteed fixed interest rate that never changes. The monthly principal and interest payments never change and the payment is a flat rate unless renegotiated.
Personal lines of credit
Personal loans are a format of installment loan that can be used for a variety of purposes. Many people will use these to consolidate debt or to pay off emergency expenses like a vehicle expense or home repair. Personal loans can have a term of 12 to 96 months and are known for higher interest rates.
Positives of Installment Loans
Many people choose this form of a cash advance because bad credit installment loans with guaranteed approval have payments that are at a flat predictable rate. When you decide to take out an installment loan, you will have a predictable payment schedule. This can only change if you add on additional things to your loan such as insurance. Otherwise, your loan repayment plan will be the same as agreed upon until the loan is completely repaid.
Knowing your repayment amount and when it is due makes it easier to budget for loan repayments each month. This prevents missing payments or any possible changes to how much you must repay. When you are seeking an installment loan be sure you can repay your loan. Be aware that financial emergencies can happen and be sure payments are covered through budgeting. Using an installment loan gives you the relaxation knowing your debt will be paid off by a specific date. Once the number of payments are made, your debt should be repaid.
Negatives of installment loans
There do happen to be negative attributes to installment loans which include not being able to take out extra money. You would have to take out another loan if you wished to borrow more money. If you need an installment loan be sure to take out the exact amount you need. Another drawback is that these loans can come with fees and penalties that include application fees and potentially prepayment penalties as well.
If you need an installment loan, you need to understand the terms of the loan and understand the agreement. If you are in need of an installment loan be sure to browse our website and find out exactly how we can help you in your time of need. We are more than happy to help you and now is the time to get started.