Question 1

What are short-term Installment Loans?

Accepted Answer

Short-term Installment Loans are unsecured loans, which means you don't have to offer anything as collateral to receive one. What’s more, you don’t necessarily need good credit to qualify for one. Many lenders don't have a minimum credit score requirement and offer these loans to borrowers with proof of a steady income and the ability to repay the loan amount.

Question 2

How do Installment Loans work?

Accepted Answer

When you get an Installment Loan, you receive a lump sum of money from the lender and use the funds for whatever you need. You then repay the loan in monthly payments (a.k.a. “installments”). When a loan is considered a “short-term” loan, it typically means you’ll have a shorter repayment window with larger monthly payments.

Question 3

Different types of short-term Installment Loans

Accepted Answer

While all short-term Installment Loans are similar in how they’re structured, several different types of loans fall into this category.

Personal Installment Loans

A personal Installment Loan is one of the most versatile and flexible financing options on the market. You can use a personal loan for just about anything, including car repairs, home renovations, wedding costs, funeral expenses, an emergency vet visit, or past-due bills.

Short-term student loans

Federal student loans are repaid over decades, which makes them long-term loans. However, some colleges and universities offer short-term student loans to help enrolled students address more immediate financial needs.

In general, short-term student loans must be repaid by the end of the next semester or school term. You’re also limited to using the funds for college-related expenses.

Short-term auto loans

Auto loans are extremely common and serve a specific purpose. If you want to buy a new or used car, you probably can't afford to pay for it in cash. As such, you’ll need an auto loan to finance your purchase.

Auto lenders typically offer terms ranging from 24 to 72 months, with a 24-month car loan falling into the “short-term” loan category. When you choose a short-term auto loan, you’ll have higher monthly payments but pay less interest over the life of the loan.

Question 4

Benefits of short-term Installment Loans

Accepted Answer

When you take out an Installment Loan, you can:

Set up convenient payments

One of the biggest advantages of getting a short-term Installment Loan is the payment structure. While the exact payment terms will vary from lender to lender, Installment Loans typically have fixed interest rates and fixed monthly payments. As such, you always know exactly how much money you’ll owe each month and when your payment is due.

Refinance the loan at a later date

If you aren't happy with your loan’s terms and conditions, you might be able to refinance it later.

Refinancing is when you take out a new loan to repay your current one. The advantage of doing this is that you may be able to get a better interest rate or extend your repayment window.

Receive funds the same day

Depending on your lender and what time you apply, you can potentially receive same-day funding for your Installment Loan.

At Advance America, we deposit funds directly into your bank account the same day if you’re approved before 10:30 AM EST! Approvals made after the cutoff time are funded on the next banking day.

Compare options to find the best rates

Once you start shopping around for the best Installment Loans, you'll quickly discover a variety of lenders offering competitive rates. Be sure to compare the terms, interest rates, and conditions of each loan to ensure you choose the best one for your needs.

Improve your credit score

Finally, if you have bad credit, you might be able to improve your credit score by making regular, on-time payments on your Installment Loan. Even if you work with a lender that doesn’t report to the credit bureaus, borrowing the money you need to pay bills can prevent your other creditors from reporting missed payments.

Question 5

Reasons to apply for a short-term Installment Loan

Accepted Answer

There are many reasons you might apply for a personal loan. For example, you might use the money from an Installment Loan to:

Pay for an emergency

Whether you have unexpected medical bills, auto repairs, or a funeral, Installment Loans are handy for emergencies. That’s because they’re available to borrowers from all credit backgrounds and are readily available in a wide range of dollar amounts.

Put down a large deposit

On a happier note, you might want to use an Installment Loan to plan a special occasion like a wedding. Borrow the money you need to save your date at an event venue, reserve a photographer, or pay for part of your honeymoon.

Upgrade your home

An Installment Loan can help you afford necessary home repairs and upgrades. Whether you need a new air conditioner or appliance, or you want to remodel your kitchen, you can use the funds to cover the costs.

Consolidate debt

Many people take out an Installment Loan to consolidate debt. Debt consolidation is when you apply for a loan and use it to pay off multiple existing loan amounts. That way, you only have to worry about making a single loan payment. Plus, if you can get a better interest rate with your new loan, you’ll save money!

Question 6

Short-term vs. long-term Installment Loans: What’s the difference?

Accepted Answer

Aside from their repayment term lengths, short-term and long-term loans will differ in:

Short-Term Installment Loans