What are the Benefits of an Installment Loan?
What are the benefits of an installment loan over other types of loans? Benefits of installment loans include more relaxed terms and it’s easier to qualify for them than some other types of loans. One of the most attractive benefits of an installment loan over other types of loans is that they allow you to pay off your debt in equal installments.
Planning on getting a personal loan? Here are the questions you need to ask first
There are lots of reasons why someone will prefer an installment loan over other types of loans. Some benefits include:
- Quick Money If You Need Money Urgently – installment loan is the best option as conventional lenders take time to process your application and check your credit history before approving your application. The approval rate for this type of loans is high, and you can get approved within 24 hours or less.
- Easy Loan Eligibility – unlike unsecured loans that need collateral, an installment loan doesn’t require any collateral as security to the lender. In fact, you don’t even need a credit check. The only thing lenders look at is your repayment ability and stability. This makes it easier for almost anyone to get an installment loan.
- No Prepayment Penalty – You can pay off your loan in full any time you want without being charged. It means that if you have some extra cash and want to pay off your debt before it’s due, you can do so without worrying about extra charges.
All these Benefits can assist borrowers in most financial situations without having them wait until their next payday which could be weeks away. Monthly installments provide a stress-free way of repaying your borrowed funds so you don’t have to panic about finding the cash to settle your loan. There are downsides as well as benefits that you need to be aware of.
- Excessive Interest Rate One disadvantage with installment loans is that the interest rates are usually very high because lenders consider them as a higher risk loan.
- The other downside with installment loans is that there may be deferment in payments if you face a cash crunch. In such cases, the lender can charge punitive fees or late payment fees from you.
- Sometimes consumers feel tempted to take multiple installment loans from different lenders in order to save on interest and monthly installments, but this is not advisable as it would increase the risk levels and hence not recommended.
Being aware of the downside as well as the benefits allows you to make an informed decision of whether installment loan is the best way for you to get the cash you need. MyFundingChoices.com website allows you to get answers to questions you may have regarding an installment loan sometimes called a short-term loan to help you make the right decision.
You can apply online without any obligation and speak to a customer service representative that can assist with answering your concerns if the FAQ on the site does not provide enough detail. Needing cash when your options are limited can make it very hard to make a sound decision. Having a source to help you with understanding not only your options but the terms of the agreement if you choose to move forward can be a great benefit to you as a consumer.
Here are all the questions you need to ask before getting a personal loan
