Whether you’re looking to pay for a large expense, consolidate high-interest debt or buy a car, an installment loan could be the right solution for your situation. Installment loans are available at banks and credit unions as well as online lenders.
A monthly installment loan is a lump sum of money that you agree to pay in regular, equal payments over the life of the loan. The payments are called equated monthly installments (EMI), and they include principal, interest, and fees rolled into the loan by the lender.
If you’re looking to borrow a substantial amount of money, an installment loan can be an ideal option because it’s a fixed payment until you’ve paid off the entire balance. However, it’s important to consider the pros and cons of this type of loan before you apply.
Credit score boost: As long as you make on-time monthly payments, an installment loan can improve your credit score. This can help you qualify for other types of credit and make it easier to get approved.
Refinancing opportunities: If you decide to refinance an installment loan, you’ll likely be able to lower your interest rate or reduce your loan’s length. This can help you save money and keep your debt-to-income ratio low.
The best way to ensure you choose the right installment loan is to shop around. This can be done by applying at multiple lenders or going to your local bank and credit unions. monthly installment loan