Dealing with unforeseen financial situations and sudden need for cash can be hard. When you need money quick and easy, you don’t want to wait for a traditional bank loan, because it can take weeks before you get an approval. A personal installment loan is a medium-term loan that’s repaid in installments. You can check for matching services like Slick Cash Loan and apply instantly. This brings to the main question – Are installment loans better than payday loans? here are some of the aspects worth knowing.
The basics
As mentioned, installment loans are paid in installments, and you can borrow as much as $3,000 for a period not exceeding 24 months. Payday loans, on the other hand, are unsecured short-term loans that must be repaid on your next payday, and typically, you can borrow as much as $750 (sometimes a tad more). Both installment loans and payday loans can be approved without any credit check, or despite a low credit score, and it doesn’t take a lot of time before one gets an approval. Also, the interest rate is always high for short and medium-term loans, and both installment loans and payday loans belong to close categories. However, the similarities end there.
Benefits of installment loans over payday loans
The foremost advantage of installment loans is the amount itself. You can borrow as much as $3,000, and that can help with most short-term requirements. Since the amount is repaid in installments, you have the advantage of planning your financial situation to repay the principal with interest. In most cases, lenders don’t want to know much about the credit score of the applicant, but you can also go for a secured installment loan too.
In contrast, payday loans are short-term loans, so you have to arrange the money in a short time. It should be noted, however, that payday loans are better for people who need a small amount of money. With installment loans, you can handle bigger emergencies better.
Final word
Both installment loans and payday loans have a few pros and cons in comparison, but there is no denying that these credit options are handy for people in a financial situation. Just make sure that you check the requirements in detail and follow the terms and conditions. If you want to get a loan on a bad credit score, that’s also possible, as long as the lender is happy with your employment record.
