Responsible borrowing is all about keeping yourself restricted to just real needs rather than taking loans without second thoughts. At the same time, it is about commitment to repayment so that you can maintain your credit score and reputation as a borrower. Timely paybacks are not easy for everyone, particularly for those who are in a tight spot financially. Still, this is something that you will absolutely have to do. There are options for such borrowers who want easy repayment plans and installment loans are one of them.
These loans are very similar to payday loans in terms of ease of approval but they differ in terms of payback arrangement. Essentially, you need to pay them back in small installments over a period of time rather than in one shot (as it is in case of payday loans). You can easily get installment loans online but the fact is that you shouldn’t take them less seriously.
After all, these are still a liability, however easy they may be to pay back. Let us share an in-depth guide for beginners who want to apply for these loans.
Before you apply for installment loans online!
Any loan you borrow adds to your liability and you need to be prepared to repay it subsequently. With installment loans as well, a proper understanding of the responsibility is mandatory. Basically, your loan value is added to the interest amount and the total is divided by the number of installments to calculate the value of each installment.
The number of installments and their frequency is decided by mutual agreement between the borrower and the lender. While you can get installment loans from local lenders, online is a better option because of the ease and speed it assures.
How to apply for an installment loan online?
Now that you have clarity of the concept, you will obviously want to know more about the online application process. First things first, you need to find a legitimate and trustworthy website that connects you with genuine lenders. The best way to do so is by checking the online reviews of real borrowers as these give you a fair idea about the credibility of the website. Once you shortlist the site, go through the terms and conditions to understand their process and lending norms.
Next, you just need to fill a few details in an online form and click to submit. Ensure that the entire information you provide is accurate because the lender will verify it before approval.
How does the loan process work?
Typically, installment loans online are a great option when you need emergency cash but are not in a position to pay back in one go. With this form of borrowing, you can get instant help because approval can come in just a few minutes if you qualify. Once you get an approval, the funds will come in your account within only one or two working days. The best thing about online loans is that there is hardly any paperwork that you need to submit for approval. Therefore, online applications are ideal if you are looking for quick money without the inconvenience of following up with local lenders and collecting documents.
What are the repayment norms for these loans?
As said before, you pay back installment loans with smaller payments spread over a period of time. This period is generally decided by mutual agreement and depends on the value of the loan and repayment capacity of the lender. Generally, online lenders are willing to convert payday loans or short term loans into installments spread over a few weeks or months. Still, you can discuss the options for a longer period though the interest on it will increase proportionately. Once the loan term and installment value is decided, you start paying them off till the entire amount is paid back to the lender.
Why do online installment loans make sense?
Considering everything that you know about online installment loans, they definitely make more sense than applying for one with a local lender. Here are explicit benefits of availing this option:
- Nothing matches the convenience of the process because you can apply in just a few clicks rather than have to pursue banks and local lenders by visiting them personally.
- The documents required for online loans are minimal. You will hardly need to waste any time in collecting them for approval as it happens in case of conventional loans.
- Speed is another factor that makes online borrowing a preferred option. If you need cash right now, this is the best way to get it because the entire process takes just a day or two.
- There is transparency in the process as everything is clear in the terms and conditions of the website. You know the interest you have to pay, which enables you to steer clear of scams and predatory lenders.
- The eligibility requirements for online loans are less stringent as compared to the traditional ones. All you need to do is just prove your repayment capacity and you are good to go.
- Bad credit is not such a big deal with this form of lending. Even if you have a low credit score, you still have good chances of getting an approval provided that you are able to prove your repayment capacity. This is because your application goes to multiple lenders and there is always a probability of getting approval from one or more of them.
- Besides bad credit installment loans, you can also get a no credit check loan online. In this form of lending, the lender approves the loan without even a second look at your credit score. Rather, they perform soft credit checks to validate your repayment capacity.
Installment loans online definitely make life easier for people who need money desperately and want easy payback plans. There isn’t the pressure of paying back in lump sum and neither is there the risk of flouting the due date. You can surely repay your loan easily in smaller installments and save your credit score in the long run.