Short -term (90 days or less) installment loans are similar in many ways to payday loans. For example, to get a $1000 loan you would go through the following process:
1.)Do an online search for installment loan providers. There are literally thousands online, just as there are thousands of payday lenders.
2.) If you can find the information check a couple for interest rates. I found it difficult to find even a general interest rate without actually filling out all the loan applications. However, with interest rates in the 100s of percents, a couple of percentage points is really not going to save you that much money on such a low amount.
3.) Fill out the application. Some providers promise you money within the hour.
The requirements for an installment loan are very similar to a payday loan.
1.) You must be employed
2.) You must make over $800 month
3.) Most lenders won’t lend you more than $1500.
The last point is different than a payday loan. Typically a payday lender will give you a $5000 loan.
The Advantages of an installment loan are as follows:
1.) You have longer to pay off the loan.
2.) The payments are the same every time. (Typically with a payday loan if you don’t have the money to pay off the original loan you have to take out another loan, making the payments higher and creating a cycle of debt.
3.) There is no penalty for paying the loan off early.
4.) They will not run a credit check as long as you meet the above requirements.
According to some research a 90 day installment loan will typically be slightly cheaper than a payday loan of the same amount. However, that is not always the case. The interest rates are still incredibly high as are the initial loan fees. The main advantage of an installment loan is time.
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