Do you have bad credit? Worried you won’t be able to get a personal loan because of that?
Well, there’s good news! You can get installment loans for bad credit.
Not sure what installment loans are, or if taking one out is in your best financial interest? In this article, we’re covering everything you need to know about how to get a loan with bad credit, so you can invest in your financial future.
What Are Installment Loans for Bad Credit?
Installment loans are loans in which you borrow a set amount of money that you then repay on a fixed schedule. Payments for one are usually done on a monthly basis so the loan can be paid off in its entirety by a specific date. They’re an ideal option for people with no credit history or lower credit history who are in need of a loan.
Installment loans are often offered by online lenders like https://loanatlast.com/online-installment-loans-arizona/ as well as local banks and credit unions. Some common installment loans include personal loans, auto loans, and mortgages.
There are a few different types of loans to know of when shopping around. Here are some of the major loan types worth knowing:
Personal loans are loans given to you by the bank or another financial institution. They’re generally paid back in monthly installments. They can also be secured personal loans or unsecured personal loans.
A secured personal loan is very common and often used for a car or mortgage. With this loan, you secure the money using one or more of your own personal assets. These assets then become collateral if you are unable to pay off the loans as agreed upon.
An unsecured personal loan isn’t backed by this kind of collateral. That makes it riskier on the part of the loaner, which is why they’re often less likely to approve of this option for people with poor credit.
How Do Installment Loans for Bad Credit Work?
Bad credit installment loans are a lot like your standard installment loan. They can be for a few hundred dollars or thousands of dollars and can be paid back within a few months or several years.
Like other installment loans, fixed or variable interest rates can apply. With a fixed rate, the interest rate stays the same for the life of the loan. With variable interest rates, the interest rate can fluctuate over the lifetime of the loan.
Terms and conditions, as well as interest rates, can vary from lender to lender for these installment loans. In general, though, these loans tend to have higher interest rates. They also tend to more costly fees.
Because these loans come with high interest rates, you may want to explore alternatives to borrowing before making a final decision. You can reach out for credit counseling, shop around for a low-interest credit card, or work with your current creditor to restructure your payment plan.
Final Thoughts on Installment Loans
Just because you have bad credit doesn’t mean you have to give up on your financial future. By following the advice in this article, you can review the different installment loans for bad credit, and get the money you need to move forward. Did you find this information helpful? Explore the rest of our website for additional insights!