It happens to all of us to need some extra money to fix something in the house, to buy a new car, to pay the kids’ studies or for any other reasons.
The installment loan is a solution when you need to get a certain amount of money in short time. Here are 5 main advantages of an installment loan:
1. Easy method of getting the needed money without many requirements for qualification.
2. The rate is the same all over the loan’s duration and the unpleasant surprise of a higher rate it doesn’t exist.
3. The installment loan is sent into the bank account and you can access the money right away.
4. Your credit report will be a positive one if you pay the installment loan on the established date.
5. The monthly payment for an installment loan is smaller than the rest of the loan types. This is an advantage for your each month’s budget.
This is a summary of the installment loan’s advantages. The possibility of getting the money in a very short time to use it for something that you need is the biggest advantage.
You will pay a certain amount of money for a predetermined period of time until the entire loan as well as the fees are paid. An installment loan is a good idea if you want to pay some credit card debts or some debts of another nature, especially if the installment loan rate is lower.
Not only you will pay the debts, but you will bring an improvement of your credit rating. An installment loan can be cheaper than a credit if we compare the fees and the rates.
The rates of the credit card companies may vary from 9% to 25% and if there is no full payment of the balances, the rates may compound monthly.
On the long term, a higher interest rate can only mean a more expansive revolving debt. In comparison to the credit card companies, the installment loan lenders come with interest rates that vary from 2% to 18%.
A revolving debt can involve high fees for the annual maintenance or for the late payments. There are no such charges when it comes to an installment loan.
You can save hundreds or even thousands of dollars if you use a low interest rate required by an installment loan in order to pay a revolving debt.
A person can borrow a larger amount of money via an installment loan compared to a short-term loan and this is due to the way the installment loan will be paid back.
A short-term loan amount depends on the amount of money you will obtain on the next paycheck. If you know how much money you can make every month, you can decide when you can pay the installment loan back.
There are installment loan lenders that offer tax breaks, if you want to buy your first home, for example. To find if you can get any deductions, ask the tax accountant.