When to Consider Installment Loans for Bad Credit
June 5, 2020 by Daniel Azzoli
When you’ve hit a run of bad credit and are working hard to pay bills and make ends meet, things can get very stressful. You may be wondering what options you have and what makes the most financial sense if you run into an emergency expense and don’t have the savings to deal with it. A personal loan may be an option but getting one with poor credit might be a bit more challenging. Luckily, there are lenders who offer installment loans for bad credit and they may be able to help get you started in this process.
Bad credit installment loans are personal loans offered to people with poor credit, imperfect credit, or no credit history at all, and can range from a few hundred to a few thousand dollars. Like other installment loans, they are generally paid back over a set term with fixed or variable interest rates that may sometimes be dependent on an individual’s credit score. Depending on the loan terms, there may be other types of charges as well.
If you’re considering applying for a loan and have bad credit, there may be options out there for you. Continue reading to learn more about what they are, when they’re beneficial, and how you can take out an installment loan online.
What’s the Difference Between an Installment Loan and a Payday Loan?
While both loans can be used for unexpected emergency expenses and by those with poor credit, there are marked differences between payday and installment loans to consider before applying for either. The following table offers an example of a side-by-side comparison of a monthly installment loan for bad credit vs. a payday loan for bad credit.
Installment Loan for Bad Credit
Payday Loan for Bad Credit
Fixed multiple payments
Paid in one lump sum
Loan term can span months to years
Pay back on next pay date
Secured or unsecured loan
Potential Benefits of Choosing an Installment Loan for Bad Credit
When you’re thinking of applying for a loan and you have bad credit, you can generally expect to pay higher interest rates. If you’re looking for a more flexible option that doesn’t require immediate repayment in full, you may consider an online installment loan for bad credit. Here are a few more potential benefits of choosing installment loans to pay for your unexpected expenses:
- Online options offer funds relatively quick for unexpected expenses
- Online options also often give you the chance to start the application process 24/7
What is an Online Installment Loan?
When an unexpected expense like a medical bill or emergency car repair arises, you may find yourself wondering how to pay for it. Often times, expenses like these require payments within a short span of time, leaving you with a few options, especially if you have bad credit or no credit.
If that’s the case, consider an installment loan online for bad credit. These loans are managed by lenders or credit service providers who offer online loans, with the entire process being conducted online. Borrowers may generally receive funds as soon as the next business day, making it a potential option if you have to pay for an emergency.
What are the Requirements to Apply for an Installment Loan Online
Before applying for loans, such as monthly loans with bad credit, make sure you meet the following requirements:
- You are of legal age to contract in your state
- You are a US citizen or Permanent Legal Resident
- You are a legal resident of the state where you are seeking an installment loan
- You have an active bank account
- You have a regular source of income
- You have a valid contact phone number and email address
If you’re seeking an installment loan for bad credit with MoneyKey, it may be helpful to talk with an agent. An online loan expert will be able to offer help with applying for an installment loan or can simply answer your questions online or via phone.
When to Consider Installment Loans for Bad Credit
Traditional installment loans are often used for a variety of purchases from home mortgages to auto loans. If you have bad credit or no credit at all, qualifying for loans can sometimes be challenging.
What many people may not know is that there are installment loans available even if you do have bad credit, and they can be especially useful in certain unexpected situations. If you need the money quickly, an online installment loan may be a viable option. Here are a few scenarios where you might consider seeking out an online installment loan for bad credit:
- Unexpected car repairs
- Emergency medical expenses
- Unforeseen home repairs
Who is a Good Fit for an Online Installment Loan
Online installment loans are available to many people, but they may be especially useful for people who haven’t established credit or have bad credit.
An online installment loan for bad credit may be an option if:
- Your credit score is below 600
- You need to borrow under $5,000
- You do not have savings to cover unexpected expenses
Finding the Best Monthly Installment Loans for Bad Credit
Looking for loans, such as monthly installment loans, can be overwhelming. There are so many lenders, interest and/or fee rates, terms, conditions, and factors to consider. Before you apply for an online installment loan, ask these questions:
- What is the interest rate and is it variable or fixed?
- Are there additional fees?
- Are there penalties for prepayment or defaulting on the loan?
- How quickly will you receive funds?
- Do you need collateral (secured loan)?
- Does the lender or credit service provider operate in your state?
- What terms are available, and do they fit with your budget?
- What is the maximum amount you can borrow?
Of course, there are several other questions you may have, which is why MoneyKey is here to help. We make the process of applying for online installment loans for bad credit simple, so contact us with questions and we will be happy to help you. Our knowledgeable representatives are ready to give you online installment loan information that may offer you the solutions you’ve been looking for, whether you have bad credit, no credit, or just need to make a payment quickly for an unexpected emergency.