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You didn’t get started out on the right foot and now you have bad credit. But you’ve begun to dream of a better future and you are wondering if there is any hope at all.
There may be. You may be able to find installment loans for bad credit.
Installment Loans are quick and easy loans that allow you to borrow for your needs without putting your personal credit at risk. They come in many different forms, but most installments loans are typically structured based on the length of the loan with regular monthly payments. And while most installment loans require good credit, there is an alternative solution geared towards bad credit borrowers like yourself.
What is an Installment Loan for bad credit?
Since installment loans are already structured as a longer-term form of borrowing, they are often referred to as installment loans. In general, this repayment schedule will allow you to borrow a specific amount for a specific purpose and then repay the loan with monthly payments over a specified timeframe. The length of time will vary according to the loan provider, but it’s usually between 12 and 60 months.
The amount that you can borrow depends on your credit score, income, and personal financial situation. If you have minimum or no credit history or score available to your lender, they may base their decisions on income alone.
But if your credit score is good, you may qualify for a larger amount. Meanwhile, if you have a low or bad credit rating, a longer repayment period may be a good choice since it will allow time to build up your credit history.
How does an installment loan for bad credit and work?
If you have a bad credit score and you want to borrow money, you might be surprised to learn that installment loans for bad credit are not as difficult as you might expect to secure. This is because loan providers have access to many different ways of assessing the risk associated with giving a loan to someone with poor credit. For example, some lenders will assess their risk by the amount of collateral you can offer.
How can Bad Credit Installment Loans Help Me?
In order to get an installment loan from a lender, you’ll need to fill out an application and provide supporting documents that will prove that you can get the money that you need. By submitting this factual information, the bank or finance company will determine whether your application is eligible for approval based on your personal financial situation and financial status.
Common Types Of Installment Loans for Bad Credit
Many lenders offer a wide range of installment loans to both individuals and businesses. And while the type of loan that you will get might vary, there are five main categories.
- Fixed-rate installment loans are the most common form because it’s based on your qualified income.
- Variable-rate installment loans are usually offered by banks or finance companies because they can offer lower rates when it’s too risky for them to issue other types of installment loans.
- Rolling-term installment loans are also popular because they provide a fixed amount of money each month with a fixed interest rate for a fixed period. However, these types of installments usually have a flexible repayment schedule to allow you to pay back the money in full, without interest or penalties by any specific payment date.
- Reverse mortgages are also a popular form of installment loans because they provide a fixed amount of money for a fixed period. But instead of paying it back in cash, you can sell your belongings or cars to pay off the loan.
- Adjustable-rate loans are similar to variable-rate installment loans but have more flexible rates since they’re based on an index. This means that the rate you have to pay will change over time rather than being fixed for a fixed period of time. However, this type is usually offered by banks or finance companies and is known as a “credit trap” because it provides a riskier option for people who have a little credit history with lenders.
What is Considered Bad Credit?
If you have bad credit, it can make your life difficult if you find yourself needing to get a loan. However, the good news is that there are many loan providers who will accept installment loans for bad credit. And while they might require a higher interest rate and lower cash payment than other types of loans, they’re still the best option for those with poor or limited credit history.
Let’s Talk About Installment Loans for Bad Credit
If you have bad credit, you know you are part of the high-risk loans market. It’s possible to find loans, but it’s more important than usual to make sure you are borrowing for the right reasons.
You probably shouldn’t be looking for installment loans for bad credit as emergency loans. There are exceptions to this rule, but keep in mind that “You can’t borrow your way out of debt.”
That doesn’t mean you can’t use debt to improve your situation. Borrowing to cover car repairs so you don’t lose your job or seeking personal loans for debt consolidation can be perfectly good ideas.
Good Reasons to Seek Installment Loans for Bad Credit
If you have bad credit, you should probably be looking to family, friends, and charitable organizations to help cover emergencies. Good debt is debt that solves a problem or otherwise helps build a better future.
Here are some reasons to borrow that have good odds of being good debt:
- Education or training that leads to a better income.
- Starting your own small business.
- Fixing some problem that’s currently bleeding you for funds.
Consumer debt is usually a bad idea. It’s a worse idea if you already have bad credit. Some examples of consumer debt include:
- Borrowing to go on vacation.
- Borrowing to have a big wedding.
- Borrowing to decorate.
It’s not always immediately obvious which activities are which. Decorating your business may be a legitimate investment in a better future. Decorating your home probably is pure indulgence.
Who Is Eligible for Installment Loans for Bad Credit?
As with all loans, you will need to be a legal adult. This usually means you must be at least 18 years old.
You also need to be a citizen of the US or a legal resident. You will be asked for a copy of your identification to help show these things.
Installment loans for bad credit may not require much more paperwork than a payday loan. Be prepared to provide some financial documentation though, such as a pay stub or recent bank statement.
Apply Now For A Installment Loan for Bad Credit at TheGuaranteedLoans
TheGuaranteedLoans is a loan matching service. We help people like you find the loan products you need.
One thing that helps cause bad credit is too many hard credit checks. This can happen if you apply for a bunch of different loans just to see which ones might get approved.
We help protect against that outcome. You fill out one application and we check our database and contact lenders when we find a match.
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FAQ
Installment loans are very similar to payday loans because they are both short-term loans that provide you with cash for a set period of time. However, there are some important differences between the two. For example, an installment loan will offer you more money than a payday loan but over a longer period of time.
If you’re purchasing a car or home, then you might qualify for an installment loan despite your bad credit score. And while there are some lenders who will lend money where your credit score is less than perfect, they’re often more expensive than other types of loans. Meanwhile, if you simply need cash for unexpected expenses, installment loans can still be the answer.
Yes, you can get an installment loan despite a bad credit score. However, the best option for you will depend on your personal financial and financial situation. For example, some lenders only lend to those who have good credit scores of more than 700. But if your score is below 700, this might not be a suitable solution since it’s unlikely that you will qualify for such a high amount of money over such a long period of time.
Yes, you can get a $3000 loan with bad credit. But before you decide on a lender, you should be aware that different types of installment loans have different requirements. So it’s vital that you check all of the details before applying for a loan.
Bad credit is just one of the factors lenders use to determine whether anyone applying for an installment loan is eligible. Other factors include income, debt-to-income ratio, and other financial burdens such as child support or alimony payments or existing mortgages on your home or automobile.