Handling your finances optimally so that you are never in a financial crunch is a sweet proposition in theory, but in practice, it is often unachievable. There are a lot of ways your financial plans can get messed up, e.g. an accident to your vehicle resulting in huge repair costs, some major illness in the family, sudden unemployment, increased taxes, any one of these variables is sufficient to put you under an immediate financial burden.
For long term financial issues, coming up with a solid financial plan that ensures savings and boosts credit score is invaluable. But for immediate needs, often a loan is the key to solve your financial issues. However, there are a number of advantages and pitfalls in the process of securing a loan. If you do not have already a good credit score, getting certain loans approved can be a drag. Getting a loan from your friends without interests is a good bet but most people do not like to reach out to their kin for money. Predatory loan options are abundant but they can put you into an eternal debt circle. Hence in all fairness, an installment loan could be the best option.
Why an Online Installment Loan?
There are a number of advantages in going for an installment loan online when you need money now. Before we discuss the nuances of an installment loan, let’s look at how its online version is better suited for today’s population.
- Private and Secure: A number of people believe in the complete privacy when applying for a loan. What could be more private than applying for a loan from the security of your bedroom via the internet.
- Easy Approval: By their nature, online installment loans are easier to secure as their demand for credit score and documentation is much more flexible. You can expect approval within a couple of days despite a bad credit rating.
- You are in Charge of Repayment Tenure: The number of months needed to repay the amount is decided by you and you can get a tenure of up to 36 months in some cases.
- Considerably Large Amount: Installment loans secured online can net you up to 1,000 USD at one go. That is a considerable amount of money if you need an immediate financial boost.
Now that we have established the benefits of going for an installment loan online, let’s look at what installment loans really are.
What is an Installment Loan?
An installment loan is akin to a payday loan but it differs significantly in terms of ease of the repayment, protecting you from a debt cycle, your property and more. The biggest advantage of an installment loan is that it does not require a lump sum payment. Often people in need of immediate cash go for regular payday loans thinking they will repay the amount in full with next paycheck. But unforeseen circumstances can arise and the payment will not be done. The person then is forced to roll over the loan further at the same time paying a pretty penny for the high interest rates. This is called a debt cycle.
Under certain circumstances, the debt cycle can become so much of a burden that people are never able to repay the principal amount as they are always catching up with the interest. In extreme cases, people have been known to lose their houses, cars and other properties just to get out of the small loan they thought would help them solve an isolated financial anomaly. There is a good reason these types of loans are also called “Predatory Loans”.
Installment loans, on the other hand, allow you to budget and pay the sum back in smaller chunks over a few months. You can decide the tenure upon the lender’s agreement based on your income and savings. With each payment, you take care of not just your interests but also part of the principal amount. The amount for each installment is pre-decided hence there is never a chance of an ugly surprise.
Other Benefits to Installment Loans
Online installment loans bring to you the best of installment loans along with privacy, security, ease of application and getting the amount directly in your account. Furthermore, there are online platforms that let you connect with a number of safe and trustworthy lenders at the same time.
This allows you to compare between interest rates offered by different lenders, compare the tenures available, and identify the plan that best suits your situation and go for it. Without the help of such online platforms, it would be a back-breaking task to approach a number of lenders individually and compare their offers.
But we must end this article with a word of advice. No matters how secure, easy to repay or exciting a loan offer is, it can never beat taking care of your own finances. Once your immediate need has been fulfilled, we request you to come up with a solid financial plan to boost your cash reserve and credit score.
You never know when the next hour of need will arise but when it does, you will be armed with a solid credit score and a pool of cash to see you through the hardship.