Online installment loans are a popular option for people who need rapid cash but are not interested in a quick payday loan online. Typically, online installment loans carry a lower APR and overall cost than payday loans, which can make them a more attractive option for qualified borrowers. In this article, we’ll discuss the specifics of online installment loans instant approval, as well as their benefits and drawbacks, in order to help you determine whether a payday loan or an installment loan is right for your unique situation. Let’s get started.
Installment loans differ from payday loans in one important way – the entire balance of your loan is not due at the end of your loan term. Instead, it’s repaid in installments, as the name suggests. For example, you might take out a $2,500 installment loan online, and have the loan term be for 3,6 or 10 months. You would then repay that $2,500 – plus agreed-upon interest – during that 12-month loan term. This has a number of advantages – but also a few drawbacks. Let’s discuss these now. Are you looking for guaranteed installment loans from direct lenders only? Find out more information here.
There are a few reasons why an installment loan may be right for you. Take a look below.
Larger loan amounts – Because repayment is spread over a few months, or over a year, you can get a larger loan amount when you get an installment loan or a personal loan. This may be advantageous in some situations – though care should be taken not to exceed your income and your budget. Otherwise, you risk failing to repay.
Lower payments – Payday loans are typically due all at once, at the end of the repayment term. Installment loans allow you to pay your balance in a number of smaller transactions, which can make it easier to repay on time.
More flexible repayment – You can repay your installment loans early to save money, or even extend the terms of your loan, in some cases. This gives you more flexibility.
Online installment loans are not perfect for everyone. An alternative, such as an online payday loan with quick deposits, may be better in some cases. Here are a few drawbacks of installment loans.
Installment loans require a reasonable credit score – If you have a credit score of less than 500, you won’t be able to get a loan. In addition, recent bankruptcies, car repossessions, foreclosures, and other negative impacts on your credit could disqualify you.
Based on your income level – Your income is the main way that your loan amount is determined. If you do not make much money, you may not qualify for a large enough loan for your particular situation.
More complex to get than a payday loan – Typically, the payday loan online application and approval process for online installment loans takes longer than a payday loan. This makes them a poor choice for emergencies.
Not sure if an installment loan is right for you? Here the reasons to apply for a cash advance online.
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Learn how to manage payday loans online on a low income here.