Ironically, people who really need money are those who can’t get loan and those who don’t need money are offered loans left, right and center. This is really obvious in personal lending. If you want to get a loan but have bad credit, you will find your situation challenging to say the very least. And since the financial crash, it became even worse, as financial institutions were blamed for giving people with bad credit too much finance. In reality, therefore, getting installment loans with bad credit is incredibly hard. Incredibly hard, that is, but not impossible.
How to Find Installment Loans with Bad Credit
If you do a quick search for installment loans for bad credit on Google, you will be hit with thousands of results. However, when you look closely, you will find that they actually generally broker payday loan. This means, firstly, that they don’t offer installment loans and, secondly, that they don’t offer a loan at all. Instead, they put you in touch with other institutions that offer payday loans.
Installment loans are different. You don’t pay those back at your very next payday, in full. Rather, you pay them back in pre-arranged installments over a longer period of time, usually around one or two years. They are not exactly the same as personal loans, as these tend to be even more flexible and even longer in duration. Rather, installment loans are somewhere in between the two.
There are various solutions out there for you if you have bad credit and need some money quickly. Options include:
- Payday loans
- Installment loans
- Title loans
- Peer to peer lending
- Social loans
- Doorstep collection loans
Each of these has their own pros and cons and you need to think carefully about what will work best for you. The reality is that you do have bad credit, so the last thing you want to do is pick something that will put you in even more financial difficulties. Not borrowing money at all may seem like the best option, but this doesn’t resolve your immediate need of needing money. Furthermore, borrowing money and paying it back on time means that you will also improve your credit rating.
Steps to Take to Apply for Installment Loans
The first thing you have to do is make sure that you are actually applying for an installment loan, and that it is a direct lender option. You should still find quite a number of institutions that can help you with this. Hence, you then need to start looking at the different terms and conditions. The APR is very important, as this will determine how much interest you pay over your loan for the duration of the loan itself. The lower the APR, the lower your monthly payments, but the harder it is to get. Truly ‘cheap’ APRs are reserved solely for people with good credit, unfortunately. However, there is a difference between a 2,348% APR loan (they exist) and a 34.9% APR, after all.