subject: Installment Loan: When To Consider One [print this page] Installment Loan: When To Consider One Installment Loan: When To Consider One
Installment loans are loans that take longer to pay off, but have smaller payments. Installment loans should be considered if you have bad credit and therefore, that is the type of loan that will give you the lowest interest rate, or you just simply do not have the money to make higher monthly payments in order to pay off your loan more quickly. Keep in mind, however, that the longer it takes you to pay off your loan, the longer you will be paying interest and therefore, the more interest you will have paid by the time you pay off your loan.
If you have bad credit, you may be able to get a lower interest rate with an installment loan than another type of loan because many times with installment loans (especially the ones that offer to people with bad credit) they often times they do not even check your credit! The reason why they can offer to give these types of loans to people with bad credit is because lenders feel more confident that the loans will be paid back since the payments are much less due to the fact that installment loans are basically loans that require you to only pay a little at a time, so the term of your loan is much longer.
So, if you have really bad credit, especially if you need to get a loan quickly, or if you don't have a lot of money to spend on loan payments, you may want to consider getting an installment loan. If, however, you have good credit, and you can afford to pay off your loan at a faster rate, you probably should not consider getting an installment loan since the faster you are able to pay off your loan, the more money you will save from not paying as much in interest. Plus, you will most likely be able to get a lower interest rate getting a loan from somewhere that does not try to appeal to people with bad credit.
