When you start the search for the best installment loans available today there are quite a number of factors to take into consideration. But as someone who’s taken out a number of these in the past, and done a lot of research as well, I’m in a great position to guide you.
What is an installment loan?
Now the first thing to do is to explain what the best installment loans are. As the name suggests, they’re loans that are repaid in a number of equal installments over an agreed period of time. This may be as short as year or up to 30 years or more for long term investment loans in the case of home mortgages.
Throughout the agreed loan period the interest rate will stay the same if you’ve taken a fixed rate option or it may go up and down if it’s a variable one instead. Many people opt for the former because it lets them budget with confidence that they’ll always know exactly how much they’ll have to pay each month.
There are also secured and unsecured installment loans. The former will need some collateral like a house or an auto as security while for the latter you may need a good credit history.
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My TOP Online Lenders for Installment Loans
What to consider before taking an installment loan
You’ll have a number of considerations to bear in mind when you start looking for your best installment loan and these are going to vary with your circumstances.
- Firstly, how much can you easily afford to borrow? Using a loan calculator will help you work out repayments.
- Do you want one which involves lots of form filling or would an installment loans online option be better for you?
- Might you be able to pay the loan off early? If so, look for the long term investment loans that have lower charges for doing this.
- If your credit history’s not great then maybe long term installment loans with no credit check might be a good option.
- Alternatively, think about getting a co-signer with a better credit history than you.
- Finally, take a look at your credit score. The better it is, the lower the interest rate you could pay.
When should I get an installment loan?
There are many reasons to look for the best installment loans that you can find. These include making a major purchase like a new auto, or just raising the deposit on one, paying for a big life event like a wedding or a holiday or even to consolidate other debts into one monthly payment.
How to get an installment loan in 8 steps
Once you’re sure that personal installment loans are the way to go there are eight simple stages to get through. Take each one in turn and, before you know it, the money could well be in your checking account.
- Check your numbers. When you take out an installment loan you’re making quite a commitment so you need to make sure you’ve done the math in advance. Work out your monthly income and outgoings and see just how much cash you have left over for the repayments. This is something the lender is probably going to ask you about, so you best be prepared.
- Check your credit score. Credit scoring is going to dictate the interest rate that you’re going to pay and it will even be used to decide whether you get a loan or not. So it’s a good idea to look into it well in advance. Alternatively, looking for online installment loans with no credit check might be another way to go.
- Check your options. Even though you’re planning to apply for the best installment loans that you can find, maybe there are other options. For example, it might be that you have some savings that you might be better using, especially as interest rates for savings aren’t that great right now and don’t look like they’ll be improving any time soon.
- Choose the type of loan that you’d like. Are you going to go for a fixed rate loan or a variable one? And do you want an online installment loan where everything can be sorted out from the comfort of home or would you prefer to arrange one face to face? Maybe you’d like an installment loan with no credit check – but be aware that the rates may be higher.
- Check out the best rates. Next, it’s time to start looking around for the best rates you can find. Depending on your individual circumstances these can vary greatly so make sure that you find the best ones that are going to mean the lowest possible repayments for you.
- Choose a lender and apply. Once you’ve made your choice it’s time put in your application for the best installment loan that fits all your criteria. You’ll find plenty of help online to assist you in making your choice.
- Provide all the necessary documentation. As well as carrying out a credit check on you the lender may well want documentary proof of income and address like paychecks and utility bills so be prepared to supply them.
- Accept the loan and start the payments. You’re there. Once you’ve accepted the installment loan offer all you need to do is use the money however you want and start to make your payments according to the schedule that you’ve agreed.
Installment loans vs. payday loans and credit cards
Installment loans are only one of the ways that you can borrow money. With payday loans you borrow, but usually over a shorter period and for a fixed fee that’s added to the loan amount. With credit cards you are free to borrow when you like, within your credit line of course, and payments go up the more you borrow. But the best installment loans offer you the peace of mind that repayments are spread over a longer period and stay generally the same throughout it.
What are the rates and terms of an installment loan?
As we’ve mentioned, the rate of even the best installment loans can vary due to a number of factors including loan amount, purpose and your credit history. The terms are equally flexible but generally range from around 3 to 6 years. It all adds up to a financial commitment that you can tailor to meet your individual circumstances
What are the advantages of online installment loans?
As you’re reading this online you may already have worked out that the online installment loan has a number of advantages. All the same, let’s go through them briefly.
What could be easier than arranging your loan from the comfort of your own home? No visits to the bank needed and the forms are easier to fill in online too.
- Competitive Rates.
There’s a very good chance that you’ll find the best rates online. That’s because online lenders have lower overheads so they can give you better value.
- Easier Approval.
When you apply online you won’t just find that there’s less paperwork to complete, you’ll also be find that with online installment loans instant approval is often possible. And when you’re keen to get things moving that’s exactly what you’ll want.