When you need money quickly, an installment loan is a good option. This helpful financial tool can give you set equal payments for specific term, allowing you to spread out an expenses for things such as property taxes, automobile repair, or vacation for example.
Why installment loans are better than other short-term loan options
When you’re in need of some extra cash, it can be tempting to turn to credit cards, title loans, or payday loans.
Credit cards are a form of revolving debt which usually require a minimum monthly payment. Unless you have signed up for a new account which is offering 0% interest for an introductory period, only paying the minimum and carrying a balance can let unnecessary interest charges add up. Likewise, according to information from the Center of Financial Services Innovation, most payday loan borrowers end up paying more in fees than the money they get from this type of loan.
A personal installment loan may be secured with collateral or unsecured, depending on the lender and factors like income and credit ratings. A small personal installment loan, usually between $100 and $3,000, has fixed monthly payments, and is designed to fit into your budget so you can cover your expenses without sacrificing your next few paychecks.
How a personal loan can help you cover expenses
We can’t always predict important bills and expenses. Medical care, car repairs, or a broken appliance can hurt your ability to pay other bills when there isn’t enough money in savings.
While it’s crucial to build an emergency savings account, even if you can only contribute a few dollars out of each paycheck, you may not have time to save enough before one of those unexpected expenses pops up.
Some bills simply can’t wait. Putting off a car repair could lead to other, more expensive problems. Not only is it upsetting to drive a vehicle that may break down at any time, but you could also end up stranded and facing a tow bill.
With medical issues, it’s always more comfortable and less expensive to handle problems while they are small. Don’t let an inability to pay the bill for basic medical and dental care cause you to put off taking responsibility for your health. When you are sick, you aren’t at your best. Missed work could cause a reduction of income that snowballs into a major financial problem.
Home care and repair is another area that doesn’t always fit neatly into your monthly budget but demands attention. For example, making a small repair to your roof after a storm could prevent you from having to spend thousands of dollars to handle significant leaks or mold later on.
There are plenty of benefits to getting a personal installment loan. When life throws you an unexpected expense that can’t wait, you’re planning a vacation, or just getting ready for back to school or the holidays, understanding this option could give you an affordable way to handle the occasion.