For many people, being able to access quick cash when they need it is something that sounds far-fetched. There are many situations that could push you into searching for money. When you need to fix your vehicle and don’t have enough funds in your bank account, you may prefer to borrow to handle the situation.
Also, if you have an injury or fall ill, you will not wait for weeks to get treatment. Moments like this don’t acknowledge your lack of money, and they happen without notice. One of the solutions people use when they need fast cash is applying for online installment loans.
With an online installment loan, you can get money as fast as the same day you submit your application. This means you could quickly solve any financial emergency. Besides, you can get installment loans for bad credit. Unlike traditional lenders, online installment lending agencies don’t review your credit history to decide whether to approve your request. They use other parameters to calculate your eligibility, including your source of income. Most short-term installment loans are unsecured, so you’ll not need collateral to get money, further simplifying access to financial assistance when you need it.
What Is an Installment Loan?
Online installment loans imply that the borrower gets money on the condition that they will repay over time with several scheduled payments, normally at least two. There are many sub-categories of installment loans. A mortgage loan also falls under the broader category of installment loans, but for this type, you need to provide a lot of documentation, and the company follows traditional practices, which lock many people out.
The duration of this type could be a few months to several years, depending on the amount you took and the size of the installments. When you have bad credit, most traditional lenders will not consider your request. Online installment loans help you avoid this situation as the companies don’t use your credit score when deciding on your case.
Besides, through this loan, you can have flexible payments as you agree to the contract with the lender. It could also mean lower interest rates. The only downside is the risk of default, which could mean losing the item you attached as collateral. Before you apply for personal installment loans, ensure you can repay the debt without complications.
Things to Consider Before You Apply for an Installment Loan
Before you apply for installment loans online, you need to understand the features. This will assist you in finding the right answers. Some of the things that define online installment loans include:
How Installment Loans Work
The general principle of installment loans is that you borrow a certain amount of money and repay in bits over a period of time. You negotiate with the lender to arrive at these terms. If you’re taking a big sum, you can lower your monthly payments by extending the repayment term to several months or over a year.
There are many reasons you can apply for an installment loan, including:
How Much Can I Borrow Through an Installment Loan?
You can get an installment loan for different emergencies. Depending on your needs, online installment loan lenders can approve loans from $200 to $5000 or more. Long-term installment loans tend to carry larger amounts, so if you’re working on a project that requires a substantial amount of cash, this could be a good choice. If the loan is secured, you can qualify for a significant sum because the lender has an asset to hold on to in case you default.
How to Calculate Interest on an Installment Loan
Interest is the amount you pay to borrow money from a lender. If you borrow $3000, you may end up paying $3600 in three months, which translates to $600 in interest. The interest you pay is determined by different factors, including your income, the collateral you have, and the duration of the deal.
If the provider applies the simple interest method to calculate payments, it’s easy to understand how much you need to pay. To calculate, you need to know the principal loan amount, interest rate, and the duration of the loan. For the total interest, use the formula:
Principal Amount X Interest Rate X Time
For example, if you’re borrowing a two-year installment loan for $5000 with an interest rate of 25%, it works as follows:
$2500 x 0.25 x 2 = $1250
This translates to about $52 in monthly interest payments. The interest plus principle on the example above works out to $260.4 every month.
There are online loan calculators you can use to understand how much you will be paying back on a monthly basis.
Eligibility Requirements for Installment Loans
There are several basic items you need to consider. To get an installment loan, prepare the following:
Providing this information is just part of the initial stages of your application. The lender may require additional details, which they will inform you about in the process of reviewing your request. Ensure to have an active means of contact to receive any updates as fast as possible.
How to Apply for an Installment Loan
Applying for same-day installment loans does not require visiting the lender’s physical location. You can do the entire process online. Here is a step-by-step procedure.
- Fill a Loan Request Form Online
- Receive a Lending Decision
- Sign Documents
- Receive Money
- Repay Over Time
Step one involves filling an online loan request form provided by the lender on their website. You are required to indicate your contact/bank details and physical address. Once you are done, submit it and wait for a response.
You will be informed of the decision in a short while after sending your details. Most companies review your request in minutes and provide feedback showing if your application was successful.
If the loan application was approved, you need to sign documents. This helps the lender to confirm your request and release the funds.
With the request approved, the company will transfer the money to your bank account. You can receive it on the same day or before the next business day.
Lastly, you need to repay the loan following scheduled payments as agreed.
Where Can I Get an Installment Loan?
You can apply for an installment loan through MaxLoan. The company offers an extensive network of direct lenders based in all states, so you can get money anywhere in the US.
How Do Installment Loans Affect Credit Score?
If you pay the loan on time, an installment loan can boost your credit score. In the same way, when you default, the records can damage your score.
Can I Pay My Installment Loan Early?
If you have a good installment loan provider, they will allow you to pay off early. Lenders make money off monthly interest, so when you repay early, you save on these monthly payments. Before borrowing, look for a company that does not charge for early repayment.
How to Apply for an Installment Loan With MaxLoan
MaxLoan offers instant approvals and some of the best rates on the market. To apply, use their website to submit an online application form with your details. You will get feedback with instructions. Typically, you can receive the money within 24 hours.