Need cash to cover an unexpected expense? An online installment loan might be right for you. It’s never been easier to find an affordable installment loan — and there are even options for people with low credit scores, too.
We’re taking a closer look at online installment loans with monthly payments. We’ll tell you a bit more about what it means to take out an installment loan and we’ll show you how to avoid online loan scams. Finally, we’ll show you how you can get an installment loan fast with MoneyLion.
Overview: What is an Installment Loan?
An installment loan is a type of loan that gives you a lump sum of cash in exchange for monthly repayments in the future. Installment loans are a type of “non-revolving credit.” That means that when you apply for the loan, you need to know exactly how much money you want to borrow.
Once you pay back the money you owe, the lender closes the loan. Personal loans, auto loans and mortgages are all examples of both non-revolving credit and installment loans.
The opposite of non-revolving credit is revolving credit. Revolving credit “refills” and you can use it again and again up to your limit as long as you keep paying your bills. Credit cards are the most common example of revolving credit.
There are two major parts of every installment loan: principal and interest rate. Your principal is the amount of money that you borrow when you first take out a loan. Interest is money that you pay to your lender in exchange for giving you the loan. Every month, you make a single payment that includes both principal and interest. It’s important to compare interest rates to make sure you’re not overpaying for your loan.
You’ll usually see interest expressed as “annual percentage rate,” or “APR” for short. Your APR is your effective interest rate, and it tells you how much you can expect to pay in interest on your loan per year. For example, if you take out a $1,000 loan with a 10% APR, it means that you’ll pay 10% of your loan balance ($100) in interest per year.
There are a few different types of installment loans. Some installment loans are only for specific purchases. For example, you can only use a mortgage loan to buy a home and an auto loan to buy a car. One way to get more freedom with an installment loan is to take out a personal loan. You can use a personal loan for almost anything, from books for college to HVAC repairs.
Can You Get an Online Installment Loan with Bad Credit?
Yes! It’s now possible to get an installment loan with bad credit or no credit. Search for a lender who specializes in credit builder loans if you have bad credit. These loans function as personal loans, but the lender reports your payments to the major credit reporting bureaus. This means that as long as you make your payments on time every month, your loan will help you build a better score.
Searching for a loan with no credit check? Be careful when you read the terms and conditions. Some lenders try to take advantage of borrowers with low credit by charging high interest rates, sometimes up to 25% APR. Never sign on a loan before you read and understand your interest rate.
Benefits of Installment Loans
You enjoy a number of unique benefits when you get your installment loan through MoneyLion. Here are some of the best reasons to choose MoneyLion for your installment loan.
Low APR. MoneyLion’s credit builder loan has one of the lowest interest rates you’ll find, at just 5.99% APR. You won’t have to worry about high-interest fees when you get your credit builder installment loan through MoneyLion.
No credit checks. You don’t need to submit your credit score to get access to a loan from MoneyLion. All you need to do is qualify for MoneyLion Credit Builder Plus — you’ll never encounter a credit check requirement.
MoneyLion’s loans are fast and convenient. Once you sign up for a MoneyLion Credit Builder Plus account, you can get your loan with a few taps of your smartphone. Even better, you’ll see the money instantly deposited into your account.
Improve your credit score. If you have a low credit score, an installment loan from MoneyLion is a great way to build credit. Seventy percent of people who take out a credit builder loan with MoneyLion see their score improve.
What to Know When Getting an Online Loan
There are plenty of legitimate online installment loan providers out there. Unfortunately, the ease and connectivity of the internet have also birthed a number of installment loan scams.
These scams can often seem like legitimate offers at first glance, so it’s important to stay smart when you compare loan choices. Here are some red flags to watch out for.
Payday advance loans. No matter how desperate you are for a loan, you should never visit a payday loan center. Payday loan providers focus on giving you money fast — but at ludicrously high interest rates. Payday loan providers usually charge a fee to borrow money, then an interest rate of up to almost 400% APR.
This could mean borrowing $1,000 at 300% APR and your loan accumulates about $8 a day in interest. This means that during one month, you’d pay a whopping $250 in interest.
Avoid all payday loan providers when you shop for a loan, as well as lenders who focus on very short-term loans. Never sign on a loan before you know the interest rate and terms.
Unsolicited loan offers. Legitimate lenders advertise their services in ways that you’d expect, such as though a TV commercial or online banner ad. They don’t cold call you or send unsolicited text messages.
Approvals guaranteed before you apply. Would you promise to loan someone money if you didn’t know anything about him? Probably not. Legitimate lenders operate using the same logic, which is why they ask you to submit some form of personal identification before they offer you a loan.
High-pressure sales tactics. Let’s say you apply for a loan online and you get an approval. The amount is just what you need, and the APR is low. You might even have a grace period before you need to begin paying back the loan. On the outside, it seems like you’ve found the perfect lender. But the lender tells you that you need to sign on the dotted line right now — or the offer will go away forever.
Banks and lenders who use high-pressure sales tactics almost always have something to hide. These lending sources play on your financial needs to coerce you to sign a loan without reading the full terms and conditions.
Taking out a loan is a decision that requires thought and time to compare offers with other lenders. Legitimate banks know this, which is why they never pressure you to act on a loan immediately or withhold information from you.
Other Red Flags
Some other red flags to look out for when you shop for a loan include:
- Several spelling or grammatical errors in any offer letter
- Copycat names that mimic legitimate banks such as “MomeyLion” or “Bank of Ameriica”
- A lack of professionalism in email or phone correspondence
- Lenders who contact you with a @gmail.com or @outlook.com email address instead of a company email
- Lenders who have websites that aren’t secure
- Lenders who ask for your personal information such as Social Security number over the phone
Be wary of the lender if you notice any of these red flags.
How to Get an Online Loan with MoneyLion
Are you ready to get your online loan through MoneyLion? Follow these steps.
1. Download the App.
The first step to get a MoneyLion loan is to download the app. Go to the Google Play or the Apple App store and search for the MoneyLion app. Start the download, open the app, enter your phone number and input the verification code you receive. Then, follow the in-app instructions to open an account with MoneyLion.
2. Become a MoneyLion Credit Builder Plus Member.
You’ll need to be a Credit Builder Plus member to get a personal credit builder loan from MoneyLion. Apply for your MoneyLion Credit Builder Plus account — it’s quick and easy to do through your app. There’s no credit check.
3. Get Approved for Your Credit Builder Loan.
Once you’ve opened your account with MoneyLion, you can get a $500 credit builder loan at 5.99% APR. Just submit a request for a loan through the app and you can get money deposited in your account in seconds.
Your payments will be timed to be deducted automatically on your pay dates, making it easier and more manageable.
Get Your Online Installment Loan Now
Installment loans aren’t just good for a quick injection of cash. They’re also a great way to build up your credit score without having to use a credit card. An installment loan with regular payments can help improve your score, but be careful with your due dates. Missed or late loan payments will hurt your score just like missed or late credit card payments.
An online loan with MoneyLion is fast and easy. MoneyLion also offers 0% APR Instacash cash advances. Get started today by downloading the MoneyLion app from the Google Play or Apple App store.