These loans are not the same as payday loans while installment loans for bad credit may have higher rates and less-borrower-friendly terms. Here’s exactly just how installment loans for bad credit and incredibly short-term payday advances vary.
Installment loans for bad credit. Payday loans. APRs might be far reaching but typically top down around 36%. APRs can effortlessly be near to 400%. Repaid in a few fixed re re payments during a period of time. Repaid in one single lump sum payment along with your next paycheck (typically two to a month you build your credit). Typically don’t report repayment history to credit bureaus (won’t help you build your credit after you get the loan). Loan amounts may range from several hundred to several thousand dollars. Loans are for very small amounts (typically $500 or less). Lender usually makes a hard inquiry on your credit. Lender usually does not do a hard inquiry on your credit. Loan repayment history may be reported to credit bureaus (could help)
Beware: Some loan providers of short-term loans may blur the lines between an installment loan and a pay day loan. For instance, you might see “installment loans” advertised for a small amount with payment terms ranging from someone to 12 installments and APRs up to 749%. And both on the web installment loan companies and payday lenders may promise distribution of funds regarding the next working day.
Then when searching for that loan, don’t just concentrate on the way the lender labels it — appearance carefully at the APR and payment terms to learn exactly what style of loan you’re getting and when it’s right for your needs. Continue reading “Installment loans for bad credit vs. Payday advances”