Installment Loans for Bad Credit
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If you need a small loan for a few thousand dollars and you want to keep payments simple, predictable, and stress-free, you might consider applying for an installment loan online. This is a fast and convenient way to obtain the funds you need even if you do not have an ideal credit score. Read on to learn all about installment loans for bad credit.
What is an Installment Loan?
An installment loan is typically a small- to medium-sized loan ranging between $1,000 and $10,000. They are called “installment loans” because you pay them back in monthly installments. These installments are all the same fixed size. So every month, you know what to expect.
Best Installment Loans for Bad Credit
Loan terms for installment financing can range quite a bit. A relatively small installment loan could be due back within 90 days. A larger installment loan could carry a term as long as seven years.
Why Apply for an Installment Loan Online?
When you apply for an installment loan online, it saves you time and hassle over doing it in person. Once you receive your money, you can use it in any way you need. An installment loan could be useful for paying off higher interest debt, funding a startup, upgrading your home, or paying off an emergency expense. Those are just a few possibilities.
Advantages of Installment Loans Over Payday Loans
Installment loans are often mentioned in the same breath as payday loans. These two lending products are similar in several respects. Both tend to carry shorter loan terms and be for smaller amounts than larger personal loans. You also can apply quickly for either online. Here are a few reasons to think about installment loans rather than payday loans for your financing needs:
- You can borrow a much higher amount through installment loans than you can through payday loans. Payday loans tend to max out around $1,000. In some states, it is possible to get an installment loan up to $40,000.
- You have more time to pay back an installment loan. With a payday loan, the principal and interest are due within 2-4 weeks. With an installment loan, as previously mentioned, you may have months or years to pay off the loan.
- Installment loans may be more affordable than payday loans with more reasonable interest rates.
- This type of financing is predictable. Because your monthly installments are all the same amount, it should be easy to calculate if you can afford this loan and how long it will take you to pay it off.
- While instant approval is not possible, you will be informed instantly after you apply whether you are eligible. Final approval may take a few hours.
What are the Basic Requirements for an Installment Loan Online?
To qualify for an installment loan online, you will need to meet these requirements:
- You must be age 18 or up.
- You will need to document your income and prove that you are steadily employed.
- You must be ready to provide current contact information and an active bank account.
Are There Installment Loans for Bad Credit? Yes!
Are there credit requirements for installment loans? Is it possible to get an installment loan if you have bad credit? Are there guaranteed installment loans for bad credit direct lenders? Or will installment lenders online turn you away like a traditional lender might when they see your low credit score?
Actually, there are many direct lenders for bad credit installment loans. Some of them are reputable and others are not. You will need to make sure that you are dealing with a lender that is licensed in your state and which is following responsible lending practices.
On this subject, there is no such thing as guaranteed installment loans for bad credit direct lenders—not legitimate ones, anyway. Nobody can responsibly guarantee you approval on a loan before you apply. If you do see a lender advertising this, you should take your business elsewhere, however tempting the offer may look.
Are There Monthly Installment Loans No Credit Check Direct Lenders?
It is only responsible to assess a customer’s risk before granting that person a loan. Running a credit check is part of this process. Even though long term installment loans no credit check direct lenders exist, we do not recommend you use them. You want to deal with a lender that only approves financing to customers who can afford to pay it back.
This is why instead of suggesting no credit check loans direct lenders, we recommend those which run what is called a “soft” credit check. With a soft credit check, lenders are able to take a look at your score without damaging it. This is different from a “hard” credit check, which is the type of check where your score takes a hit.
So if this is your reason for wanting to avoid a credit check, you have nothing to worry about so long as only a soft credit check is used to evaluate your risk profile. And if you are concerned that your credit score is too low to qualify, don’t be. Many installment lenders have built a business around providing loans to consumers with fair or poor credit. To these lenders, other factors such as your income and the status of your employment are more important than your credit score.
How to Check and Improve Your Credit Score Before Applying for an Installment Loan
Even though you can get an installment loan with poor credit, that does not mean that your credit score is irrelevant to the loan application process. Even if your score is not factored into approval, it will still influence the interest rates and terms which are available to you. This means that the higher your credit score is, the more likely it is that you will be able to save money and enjoy flexibility in your installment loan.
To find out what your credit is now, submit a request to any of the three major credit bureaus (Equifax, Experian and TransUnion). Every year, you are legally entitled to one free credit report from each of these. You will also need to separately request your credit score, which is not identical to your credit report. This is available from the same bureaus, but you will be required to pay a nominal fee.
If you prefer, you can purchase your credit score from FICO directly instead, or you can find out whether your bank or credit union makes it available to you for free or for a low fee.
What is the difference between your credit score and your credit report, and why do you need to see both? Your credit score is a number which tells lenders at a glance how risky a borrower you are. The credit report contains the information which went into coming up with that number.
Here are some quick tips for boosting your score once you have viewed your credit report:
- Check for errors on your report. They are surprisingly common. If you spot any, dispute them with the bureaus and the reporting creditors. Your score may be low because of matters that have nothing to do with you. A few quick adjustments could make a huge difference.
- Are you utilizing high credit on your accounts? Try and reduce usage if you can. Lenders want to see that you are using credit, but are not overly reliant on it.
- Pay off overdue bills if possible.
- Open new credit accounts if you can manage them properly. Ideally, you should have around two unused accounts, and one carrying a low balance (around 8.9% is excellent). Do not automatically close accounts after paying them off.
- If you generally have a solid record with a creditor, but you missed a single payment, try contacting the creditor. They may be open to erasing the negative item if you are caught up. This is a fast way to achieve an improvement in your score.
- Try improving your overall finances by reducing expenditures and/or increasing your income. Online, you can find many ideas for how to do both.
- Set up automatic bill pay online so that you never forget a payment.
With a high credit score, you should receive a wider selection of loan offers, allowing you to pick the one with the most competitive rates, terms and fees.
Apply Now for an Installment Loan Online
Applying for an installment loan online is as simple as filling out a brief form, which usually takes just a few minutes. Many lenders can direct deposit your funds within one business day, otherwise next business day.
We aim to recommend these kind on lenders and connectors
- Offer flexible credit qualification (bad credit is okay)
- Run soft credit checks
- Feature competitive rates and terms
- Follow responsible lending practices
- Operate with transparency
- Provide top-notch customer service
Ready to apply for an online installment loan today and receive the fast funding you need? Click on any of our suggested lenders in the table, and you will be on your way.