© Copyright Acquisition International 2024 - All Rights Reserved.

Article Image - Understanding the Benefits and Importance of Installment Loans
Posted 11th January 2022

Understanding the Benefits and Importance of Installment Loans

Installment loans could be a real game-changer, especially if you need flexible repayments. In these difficult economic moments, you find that you will need some cash at some point. And that's why you need to know about installment loans.

Mouse Scroll AnimationScroll to keep reading

Let us help promote your business to a wider following.

Understanding the Benefits and Importance of Installment Loans
Person using their laptop

Installment loans could be a real game-changer, especially if you need flexible repayments. I like installment loans because you will get a tremendous amount of cash and repay in small bits.

In these difficult economic moments, you find that you will need some cash at some point. And that’s why you need to know about installment loans.

So,

What are Installment Loans?

Installment loans are the loans you take in lumpsum amount then repay in small bits. If a lender allows you to make monthly or biweekly payments, that means you have an installment loan.

We call each payment an installment, and it entails some percentage of the principal amount and the interest.

Installment loans can be secured or unsecured loans. A secured loan is a loan you take against your property. To get a secured loan, you must provide collateral before the lender qualifies you. In addition, the lender needs to confirm the ownership of the property to ensure that it’s your property.

In contrast, if you take an unsecured personal loan, you don’t need to provide any property as collateral before qualifying for a loan. Instead, the lender requires you to prove that you can repay the loan without much struggle.

What are the Benefits of Installment Loans?

You can Make Big Purchases

Once you take an installment loan, buying large items is easy since you take lots of cash. For instance, it’s possible to purchase a car with an auto loan. Once you apply for an auto loan, the vehicle becomes the collateral.

In addition, you can take a mortgage loan or mortgage with collections to purchase a home and pay later in small amounts for 15 to 30 years. That said, it’s impossible to get a short-term loan to make big purchases.

However, you can take a personal installment loan that is enough to buy a car or any other big service.

You will be Sure of your Monthly Payments

Once you take an installment loan, the payment stays constant throughout the loan term. Therefore, the lender has no chance to increase or reduce your installment amount during the loan term. Thus, the repayment will stay constant unless you request a loan restructure.

As a result, you can plan your paycheck well to get some funds to save. In addition, you can budget wisely and manage to do other things during your loan repayment.

You can pay off your loan early

If you can afford to repay your loan before the agreed time, you can do it with installment loans without any additional charges. However, it would be best to talk to your lender first before making early repayments.

Remember that some lenders will charge you early repayment fees. So, you must be sure that your lender is not among such lenders.

You will not have pressure to pay off your loan

Depending on the loan amount, you can even pay off your loan for six years with installment loans. Therefore, you will not strain much during the repayments since it’s a small amount for each refund.

For instance, other loans like payday loan lenders need you to repay your loan in total plus the interest at the end of the month. That’s why you will find that most people default on payday loans.

You can get better rates with a good credit score

If you have a good credit score, you can access better interest rates with installment loans. For instance, if you take an installment loan at Heart Paydays, you can access a rate of as low as 5.99%. However, those with low credit scores can get high rates but not exceed 35.99%.

The total loan amount will not be that huge if you get better rates. And therefore, you will pay off the loan faster.

You can take Installment Loans to Build your Credit

If you are on the wrong side of your credit score, you can take an installment loan that will help you to build your credit. Most installment loan lenders report your credit history to one of the three credit bureaus. As a result, if you continue to repay your loan on time, you will manage to build your credit score.

Installment loan lenders are good than payday loan lenders who cannot help you rebuild your credit score.

Installment Loans Consist of High Loan limits

With installment loans, you can access higher loan limits than short-term loans. For instance, if you take a payday loan, you cannot exceed more than $2000 since you will repay at your payday.

With installment loans, you can get loans of up to $50,000 or more, provided that you meet all the requirements that the lender needs.

My Take

It’s good to take an installment loan, but I would recommend you create more income streams that you can use to repay the loan. For instance, if our primary source of income goes down, you can comfortably repay the loan using other means. Otherwise, you will enter into the wrong credit side once you start to repay late.

Written by Heart Paydays

Categories: Finance, News


You Might Also Like
Read Full PostRead - Eye Icon
Liberty Global’s Subsidiary Telenet to Acquire BASE
Finance
22/04/2015Liberty Global’s Subsidiary Telenet to Acquire BASE

Liberty Global plc announced that its subsidiary Telenet Group Holding NV (“Telenet”) has entered into a definitive agreement to acquire BASE Company NV (“BASE Company”), the third-largest mobile network operator in Belgium in an all cash transaction v

Read Full PostRead - Eye Icon
New Research Reveals Discrepancy Between Public and Business Ethics
Finance
08/06/2015New Research Reveals Discrepancy Between Public and Business Ethics

New research reveals 70% of people want to invest ethically but the financial services industry is failing to respond

Read Full PostRead - Eye Icon
Dispute Resolution Specialist
Leadership
04/09/2019Dispute Resolution Specialist

JAMS is renowned for the first class service that it offers in its field across the US and internationally too. Recently, Lorraine Brennan of JAMS was recognised for her outstanding work in AI Leading Adviser Awards 2018

Read Full PostRead - Eye Icon
Do Businesses Need to Adapt to the TikTok Age?
News
02/08/2022Do Businesses Need to Adapt to the TikTok Age?

Since Facebook took the world by storm in the 2010s, businesses have had to adapt their marketing strategies to align themselves with the social media craze. Those that have failed to do this have missed a prime opportunity to reach new customers and are at ri

Read Full PostRead - Eye Icon
Corporate Social Responsibility: 6 Tips for a Sustainable Business
Corporate Social Responsibility
26/01/2023Corporate Social Responsibility: 6 Tips for a Sustainable Business

Corporate social responsibility (CSR) is a business approach involving direct action to improve the environment, society, and economy. It can lead to higher profitability as socially responsible companies tend to attract more customers who are willing to pay a

Read Full PostRead - Eye Icon
A Young and Hungry Law Firm
Finance
20/03/2018A Young and Hungry Law Firm

Samvãd Partners is a full-service multidisciplinary Indian law firm with offices in Bengaluru, Chennai, Hyderabad, Mumbai and New Delhi.

Read Full PostRead - Eye Icon
Iwoca Series-B led by by Acton Capital Partners
Finance
04/08/2015Iwoca Series-B led by by Acton Capital Partners

Iwoca Series-B led by by Acton Capital Partners

Read Full PostRead - Eye Icon
How To Expand A Home-Based Business
Innovation
22/02/2023How To Expand A Home-Based Business

Doing business at home has been recently popularized due to the convenience and advent of technology. Startup entrepreneurs can get their businesses off the ground without worrying about paying for overhead expenses.

Read Full PostRead - Eye Icon
How to Get Business Finance with a Poor Credit Score
News
10/06/2022How to Get Business Finance with a Poor Credit Score

If you have previously dealt with poor credit in your personal life, then getting finance for your business through your bank might be difficult, if not impossible when first starting your company. The good news is that you do not have to let a poor personal c



Our Trusted Brands

Acquisition International is a flagship brand of AI Global Media. AI Global Media is a B2B enterprise and are committed to creating engaging content allowing businesses to market their services to a larger global audience. We have 14 unique brands, each of which serves a specific industry or region. Each brand covers the latest news in its sector and publishes a digital magazine and newsletter which is read by a global audience.

Arrow