A burst pipe in your kitchen. An expensive emergency room bill. A failing car engine. Sometimes, a crisis strikes and there’s no money to cover it.
If you need fast cash to cover an emergency, like unplanned travel expenses, last-minute tuition payments, or another unexpected event that busts your budget, you aren’t alone. Many people live without an emergency fund, or find their cash flow too limited to cover unexpected expenses.
Luckily, there are a lot of ways to get the money you need quickly and responsibly. A sudden disaster or expensive change of plans doesn’t have to spell financial ruin. You just need an installment loan to help cover costs.
Discover the ins and outs of installments loans, and how they can help you in a pinch.
How an Installment Loan Can Help
An installment loan is a unique type of loan that many people aren’t aware of. You can borrow any sum of money at a set interest rate, and you pay a set monthly rate that never changes. As Credit.com explains, if you need to borrow $10,000 for 5 years at 6% interest, you pay monthly total of $193.33.
Unlike a credit card, an installment loan doesn’t come with any limitations or dramatically changing interest. Your monthly bill stays the same for the entire length of your loan, and you never need to worry about it increasing.
An installment loan is a great option for those who need their payments to be predictable. Instead of opening a bill each month and being shocked at how much you owe, there are no surprises in this loan’s repayment process. It’s a smart option for especially big bills that strike suddenly, or for a big purchase like a car.
Installment Loans Bring Benefits
There are a number of qualities that make installment loans a smart choice for those in need of quick cash. They offer:
A Speedy Process. Fast cash is what you’ll get with an installment loan, and that can mean you have money in hand as soon as the next business day. The good news is that lending companies are conveniently located throughout states, cities, and towns. Once you’ve chosen a financial institution, you can expect them to process your loan in as little as 24 hours or as long as 3 to 5 business days. You can even request a loan online for convenience, or if urgent, seek out a physical branch that will give you an instant decision–and cash–on the spot.
Flexible Payments. An installment loan requires your balance to be paid back on a regular, fixed schedule. The payment term varies from lender to lender, so balance the length of your loan term with the amount of payments your budget can tolerate. Choose your interest rates carefully. Depending on the loan, you could face astronomical interest rates for fast cash loans. Higher interest rates mean bigger payments over a longer period of time, and big fees on top of the money you’ve borrowed. It will take you longer to pay down the principal, or the actual amount you borrowed, if your interest rate is sky high.
No Collateral Needed. Though you can get a loan with collateral like vehicles or property, those loans can take time to process. Installment loans with no collateral requirements work much faster; they only require you to fill out a form and submit at least 2 valid pieces of identification like a driver’s license, work identification badge, or utility bill. You’ll be required to demonstrate a source of steady income, so have at least your last two pay stubs ready to present.
Consolidating Finances. According to Omni Financial Group, with an installment loan, you will have a fixed interest rate that might be lower than a credit card. Rather than paying for emergencies with multiple credit cards that tie you to a bunch of balances, an installment loan is a smart way to pay off expenses in full. Instead of trying to manage and pay off several different credit cards with different due dates, you will just have one payment due date and one amount to worry about.
A Good Credit Score. New credit seekers don’t need to worry about being turned away by a bank if they’re looking for an installment loan. Lending companies are more than happy to take a chance on a customer who’s trying to build credit. In fact, people with little credit can expect that, after making on-time payments over months and years, the loan provider may even offer better credit options should you ever need another loan. Installment loans are one way of boosting your credit score when you pay as agreed and follow the loan rules.
Don’t Rack Up Big Bills with Credit Cards–Choose an Installment Loan
The next time bad luck hits and you’re in need of quick cash, consider choosing an installment loan rather than racking up charges on yet another credit card. With regular and stable payment plans, the opportunity to build new or better credit, and speedy approval time, an installment loan is both financially savvy and won’t break the bank. You can choose a loan that suits your budget and your immediate needs.
