A personal installment loan can be ideal for subprime borrowers in need. Learn more about them, and why this might be the right loan for you!
With so many different types of personal loans out there, it can be overwhelming to choose the right one for your financial situation. There are so many factors to consider when researching personal loans: the length of repayment, the interest rate, additional fees, the amount of money you need, and whether the lender is trustworthy or not. Once you weigh all of these factors together, you’ll know which type of personal loan is best for you.
One type of personal loan that’s become quite popular in the last few years is called a personal installment loan. If you’ve researched loans before then you may be familiar with what this is. There are many reasons why borrowers are turning to these loans when they find themselves in need. So if you’re considering a personal installment loan, and you’re not sure where to start, you’ve come to the right place.
Read on to learn more about what personal installment loans are, how they work, and what to watch out for when considering one.
What Is a Personal Installment Loan?
First, it’s important to know what a “personal loan” is. A personal loan is any loan product that a borrower uses strictly for personal purposes. This could be medical bills, monthly utilities, car repairs, or any other personal expenses. The next important piece of information would be what “installment loan” means. This is simply a loan that is paid back in monthly payments or “installments” over a set period of time, agreed upon by the borrower and the lender. It makes sense then, that a personal installment loan would be a personal loan that’s paid back over time, through set installments.
One of the reasons these loans have become so popular is that they offer an alternative to predatory, high-cost loans that subprime borrowers usually rely on. If you have a lower credit score it can be difficult to get approved for a bank loan, or even a credit card in some cases. Personal installment loans are usually available to subprime borrowers regardless of their low credit scores.
Applying For A Personal Installment Loan
Applying for a personal installment loan has become a much easier process throughout the years. Online lenders and application processes have made standing in line and filling out paper applications a thing of the past. There are many lenders now that offer a completely online application, funding, and payment process.
The first step in applying for an installment loan would be to research potential lenders. There are plenty of review websites that will allow you to see what previous customers have to say about a particular lender. These reviews will be an important part of your research, as you can tell a lot about a lender by what their past and current customers have to say. It’s also wise to check out the lender’s website, and make sure everything looks credible and legitimate.
Once you’ve decided that a particular lender seems trustworthy, it’s time to submit an application. Some personal installment lenders—like CreditNinja—allow potential borrowers to submit an application on their website. This usually only takes a few minutes, and requires you to enter your personal and financial information. This allows the lender to decide if their loan is right for you, and to make sure you’re able to repay the loan.
Getting Your Loan, and Paying it Back
If approved for a personal installment loan, many lenders will direct deposit the funds into your bank account. At that point you’re free to use the money for whatever personal expenses you choose. Many borrowers take out personal loans when they have an unexpected expense pop up. This could be car repairs, home appliance repairs, unexpected medical bills, school costs for children, or any other type of expense you haven’t planned for in your budget.
The next step is paying back the loan. When you’re approved, the lender will set a date for when repayment will begin. Once you start repaying the loan you’ll make monthly payments until it’s completely paid off. Many lenders will allow you to set up automatic payments, which will be taken directly from your bank account. This is a good way to avoid late payments and additional fees if you’re able to do it.
With an installment loan, each payment goes toward the principal (loan balance you’re receiving) as well as the interest (the cost of borrowing). Depending on the loan and the lender, you may be paying the loan back for a couple of months, up to a couple of years. Spreading the payments out over a longer period of time can make your monthly payments more manageable, but it may slightly increase the amount of interest you pay in the long run. If a low monthly payment is important to you, then it may be worth it.
If you’re in a tight spot financially and you need some quick cash to get back on track, a personal installment loan may be the right choice for you. These loans are designed for borrowers who may have a difficult time getting approved for a bank loan, or credit card due to a lower credit score. If this sounds like you, it may be time to check out CreditNinja. At CreditNinja, we care about your financial future. We offer safe and transparent loans to borrowers with less-than-perfect credit scores. There are never any hidden fees, or confusing terms and conditions. Visit us today at CreditNinja.com, and get your finances back on track.