If you are on the hunt for a little bit of extra cash to cover larger expenses an installment loan may be the right path to take.
One of the most popular (and commonly available) forms of lending will find in the world of financial services today, installment loans come in all shapes and sizes – from packages as large as loans for businesses and mortgages to as small as personal loans and auto loans that don’t take very long to pay off at all.
Before you go down this path, however, you want to be sure that you know exactly what you’re getting into. In this quick guide we highlight some of the more important basics of installment loans.
What makes installment loans different?
The major difference between this lending package and any other is that you will receive all of the money you need or request upfront in a single lump sum as long as you promise to make a number of predetermined monthly payments over a fixed block of time until you’ve repaid the debt – with interest.
Will I need to secure my loan with collateral?
The overwhelming majority of installment loans will not require you to secure your funding with some sort of collateral as long as your credit and your credit history are in line with what your lender expects.
If you do not have a solid credit score or do not have a long credit history your lender may request that you secure your loans with some sort of collateral – collateral you always receive back just as soon as you have paid off the loan.
Check the fine print
Before you sign on the dotted line and agree to any installment loans is important that you check the fine print and understand exactly what you are getting into. Verify the loan amount, the loan repayment terms and schedule, and the interest rate and you should be good to go.