Based on the VantageScore scoring model, these include the “subprime” scores of 500 to 600. There’s also the “deep subprime” category, with scores ranging between 300 and 499.
Now, with millions of consumers having less-than-stellar credit scores, it’s possible that you belong in this group. That doesn’t mean you can’t take out a loan anymore.
Much thanks to bad credit installment loans, you can still qualify for financing. Yes, even with bad or poor credit.
But how exactly do these installment loans for bad credit work? Where can you even find them?
All these and more we’ll answer in this guide, so, make sure you keep reading!
A 101 on Installment Loans
It goes without saying that the higher the credit score, the better (and more affordable) credit products are. This means lower interest rates, even bigger loan amounts. That’s why you should also prioritize cleaning up your credit, so you can access these offers.
But if you’re in dire need of a loan, you may want to consider installment loans for poor credit. Before applying for these programs though, you first want to know more about installment loans.
At its core, an installment loan is a loan with a fixed or specific amount of money. You pay this back in equal (or unchanging) increments every month. You and the lender agree on a specific number of months to pay back the loan.
Installment loans come in various types, with a mortgage being one of the most common. Auto loans, student loans, and personal loans are also types of installment loans.
Keep in mind that installment loans vary in terms of loan amounts, interest rates, and other unique fees and features. That’s why you should take the time to shop around, since this is key to getting the best deal. Comparing each program can help you save a lot, even with only a small decimal-point difference.
Where Bad Credit Installment Loans Come into Play
Many lenders of traditional installment loans require at least a fair credit (no lower than 601) score. Even if lending institutions qualify you with your poor or bad credit, you most likely will face the consequence of a higher interest rate.
Enter installment loans for bad credit online.
Reputable lenders of these online installment loans often don’t run credit checks on applicants. That means you still have good chances of securing a loan, even with a credit score of 600 or lower. They’re much like no credit check financing, wherein lenders won’t conduct a “hard inquiry” on your credit.
So long as you can prove that you can repay them on time, then you can qualify. With these loans designed for people with less-than-stellar credit scores, you can also expect easier-to-meet requirements. That includes having a valid U.S. bank account, amongst other basic financial details.
Easier Application, Quicker Approval
To start the application process, you only need to provide basic personal and financial details. You’ll also give a few pieces of info about your employment status. From here, direct lenders will use the information you’ve provided to determine your qualifications.
One of the biggest advantages of online installment loans is that you’ll learn of your application’s status as soon as the following day. In fact, some lenders even deposit the specified borrowed amount within 24 hours! As such, if you need access to funds right away, then a bad credit installment loan may be the best choice.
Long-Term Loans for Ease of Repayment
Sometimes, even the best payday loans may not be enough to cover the amount you need. In this case, you should consider long- term installment loans for bad credit instead. Some bad credit loan lenders can qualify you for up to $5,000!
Also, because there’s much more money involved with installment loans, then a longer term may work better for you. With an installment loan, you don’t have to pay back the entire loan amount on or before your next payday or within a month. The repayment term may still depend on the lender, but you can rest assured it’ll be longer than a month.
In some situations, such as when there’s more money involved, a longer term is the safest bet. It minimizes the risk of non-payment, which can further bring your credit score down. With long-term loans, you can spread the repayments over several months, so you can pay them back in lower increments.
A Few Reminders before Applying for these Installment Loans
As helpful as these online installment loans are, you should still practice good borrowing habits. In other words, apply only for what you need and what you’re 100% sure you can pay back on time.
Bear in mind that even a single day of delayed payment can already lead to late penalties. These are some of the last things you want to worry about, especially if your finances are already suffering.
This said, take the time to calculate how much you can pay back every month without putting yourself in a financial pinch. Say you need to borrow $2,000 and thinking of spreading the repayments over a six-month term. Make sure you can pay back the $330 plus interest every month with ease – and always on time.
Last but not the least, don’t underestimate the power of a lender connecting service. Again, it’s important to compare loan offers and providers, and such a service can help you find the best ones out there. You may even find trustworthy lenders you won’t when you perform your own search.
Find the Best Poor Credit Installment Loans Now
Installment loans can help you tide things over when you need quick access to a considerable amount of money. Bad credit installment loans can do that for you too, while also increasing your chances of getting approval with your poor credit score.
So, don’t wait until you’re only a few days away from a looming due date on a bill. Search for the best installment loans for people with bad credit now using our online service. Also, please feel free to check out our blog for more loan tips and advice.