Installment Loans are a type of loan that is repaid over a set period of time with a set number of scheduled payments. The term of the loan can be just a few months and as long as 30 years, like a mortgage loan. Installment loans are mostly associated with consumer loans, originated and serviced locally, and repaid using an amortization schedule. Every payment made has a portion of it applied toward both the principal and interest.
Installment loans are typically secured loans. The application process is quick, easy, and in a lot of cases requires no faxing of paper work. Certain applications can be approved in as little as an hour and funded that very day. The good thing about installment loans is each payment is a fixed amount so a borrower knows exactly what to budget for.
For example, let’s assume you borrow $1000 at an interest rate of 10% APY with a term of 12 monthly installments:
- $1000 + $100 interest = $1100
- 12 month term means $1100/12 = $91.66 per month.
- These $91.66 payments comprise a portion of principal and interest.
Installment loans are great for businesses and individuals who lack the cash to purchase a big-ticket item or service. They are the best type of loan to pay for buildings, houses, and cars for example. The structure of an installment loan also provides assurance to the lender that his or her loan will be repaid. Should a borrower miss a payment their interest obligations simply accrue, requiring the borrower to pay a higher total amount for the loan.
Lendiva.com is partnered with hundreds of the nation’s top installment lending companies. We will find you the best lender for your needs who can provide you with the cash you need fast. Most of our installment lending partners employee sophisticated underwriting to allow them to quickly and efficiently approve your application and fund your loan