Bad Credit Installment Loans not Payday Loans
Why You Should Get Bad Credit Installment Loans not Payday Loans
Life isn’t certain and neither are our financial conditions. If you don’t have a comfortable cushion of savings, a demanding situation might leave you with no other option than to take out a loan. But getting a loan isn’t as easy as banks make it seem. You have to have a good enough credit score to get a loan, which is practically impossible if you aren’t saving enough. Having a great credit history comes by getting into credit-related transactions and paying off the debt on time. The amount of savings in your account also adds to your credit score, therefore building and maintaining a good credit score is not easy either. If this is the condition, where does one go to get a loan? Most of the time people turn to payday lenders for help but sometimes the help turns into a vicious practice. Therefore it is wise to get bad credit installment loans not payday loans.
Installment loans have many advantages over payday loans. The first benefit that installment loans provide is that they can be repaid over a fixed number of payments. Unlike installment loans, payday loans need to be paid back in full that too after a short period of time, such as two weeks. Installment loans are legal almost everywhere, however payday loans can be considered illegal in many states.
Why you should consider taking bad credit installment loans not payday loans in times of need is also linked to the fact that payday loans can lead you to a debt trap. When you take out a payday loan with its extremely high-interest rate, the final amount becomes much higher. Added to this, is the short term loan period that is usually of two weeks and the repayment is generally due on your next payday. Many a time, it so happens that the borrower is unable to repay the full amount and the loan rolls over into a new one with a rolling over cost. To repay that loan amount, people end up taking another loan and consequently, a vicious cycle of debt begins. In case of installment loans the repayment is done in installments, therefore, the burden of the loan repayment is lessened. The interest keeps getting lesser and lesser after every installment is paid in case of an Installment loan.
Keeping in mind the above mentioned facts about both installment loans and payday loans, it would be safe to claim that one should get bad credit installment loans not payday loans when taking a loan is the only option available.