Despite the many different loans, there are really only a few different types: payday (cash advance) loans, revolving credit lines (credit cards), or installment loans. Installment loans are for when you need a larger amount of money and (presumably) several years to pay the money back. You borrow a set amount of money and pay it back over mutually agreed time period with interest at specified points throughout the length of the loan. More simply: you take out a loan and pay back in installments. Thus, installment loan.
For example, you might take out an installment loan to purchase a new car, which you will pay back over 60 months (5 years). You will pay a set amount each month that includes not only 1/60 the amount of the loan, but also the interest that will accrue over those five years depending on the set interest rate for the loan. When you’re finding someone to take out an installment loan, no matter what it’s for you can get really jipped if you don’t take the time to check out the company you’re borrowing from, resulting in insanely high interest rates, unreasonable repos, etc. Here's a look at five places to look for lenders for installment loans.
1. Your Bank
Unsurprisingly, banks, as direct lenders, are a great option for getting an installment loan. However, most banks are much pickier about their loan customers than they are for other services. Nonetheless, banks can be a great option if you want a lender you can walk up to and look at, rather than chasing someone around online and never knowing just who is on the other end.
2. Your Credit Card Company
Many credit card companies provide more than just credit cards. Capital One, for example, not only issues credit cards, but also auto loans, home loans, and personal lines of credit that work essentially like credit cards but can be used differently (such as to consolidate debts). Having a pre-existing relationship with a company as a direct lender, particularly if you are in good standing, can only be in your favor.
There are about a million online installment loan sites, some of them even have direct lenders that let you find the money in your bank account in the morning. Others can help you find direct lenders for installment loans. While some of these are great options, a word of caution to this tale: just because the internet says it is true does not mean it is. And it is very, very easy to get ripped off online.
Look for Better Business Bureau Ratings -- if they are high enough the company is proud of it, they generally post that. For example, the Lending Club gets high ratings from various financial sites and is accredited by the BBB, but Loan Now, which has a suspicious looking site, claims an A+ from the BBB. Just because the site says so, doesn’t mean it is so. Call the BBB to check a company’s claims before forking over your personal information. LendingTree does get high ratings from financial experts all over the place.
4. Brick and Mortar Buildings
Yes, they do still exist. OneMain and WellsFargo (also a bank, but well-rated for their installment loans even if you don’t use them for their banking services) are some of the highest rated brick and mortar places to get installment loans. While there may be a lot more options online, it can be a lot more reassuring to actually look at someone while you’re applying for a loan. It also tends to be easier to jump through hoops if you’re having trouble getting your hands on that loan.
5. For Bad Credit
If you’re credit isn’t so hot, you’re probably going to have trouble getting loans through conventional routes. However, many companies are in business specifically for people like you who need loans but have had a few bad breaks. Personalloans.com provides $2,000-$35,000 loans you can use for just about whatever you want, works with a variety of lenders, and has a fast and easy application with a quick response. Signatureloan.com is another well-rated online presence that can help out with installment loans for those with bad credit. While these two are great for larger loans, there are other organizations that are more appropriate for small installment loans (such as Cash Advance or Helping Hand Advances).