Long-term personal installment loans online make it easy and affordable for consumers to fund important needs. The extended repayment periods translate into lower monthly payments.

Personal loans are unsecured. They do not require collateral. They also feature scheduled monthly payments of equal size – which fits the definition of an installment contract.

People with a bad credit history can sometimes qualify without a credit check. However, many have unrealistic expectations surrounding direct lenders, guaranteed approvals, upfront fees, and cash advances. Find a better strategy.

Consumers with good credit scores find it easier to win an approval. They are more likely to pay a lower interest rate and save money by consolidating more costly revolving balances.

Long-Term Personal Installment Loans Bad Credit

People with a bad credit are less likely to qualify for an unsecured personal installment loan online. However, it is possible. Individuals with a negative history on their consumer reports should have realistic expectations and a strategy to improve their eligibility.

Request an installment loan here. The company is more likely to approve longer repayment terms when high-risk applicants allow them to make a profit. Remember that risks increase the further into the future you go.

  • Show sufficient income and verify employment
  • Provide bank routing and account numbers
  • Verify your identity with a driver’s license number
  • Take advantage of a large network of online companies
  • Put aside unrealistic expectations and limitations
    • Direct Lenders
    • Guaranteed approvals
    • No upfront fees
    • Cash advances

No Credit Check

Personal loans based on income only do not involve a credit check. The online company may use alternative information sources to verify your identity and examine your rental or utilities payment history. However, each individual company is choosy about approving longer installment repayment terms without pulling a copy of your traditional consumer report.

Therefore, be careful to enter the process with the right expectations. Having a low FICO score does not put you in a position of power.

Direct Lenders

Consumers with poor ratings hurt themselves when searching for long-term installment loans with no credit check and direct lenders only. This expectation limits your ability to gain an approval for the funding you need. Why limit choices?

A large online network of no credit check companies makes it easier to find a willing partner. Volume is the best strategy to overcome low approval odds. Yes, you start the process by working through an intermediary. However, you wind up working with a direct lender in the end.

Guaranteed Approval

People with poor FICO scores should not expect a guaranteed approval for a long-term unsecured installment loan and no credit check. No legitimate outfit will approve every person – especially without pulling a traditional report to verify your identity and detect mistaken entries on an online form.

However, it is reasonable to expect an easy approval process with quick funding if you provide the required information in the web-based form.

  • Driver’s license number
  • Bank account and routing number
  • Income and employment verification

Payday Cash Advances

People with bad credit should not expect long-term monthly installment payments on a payday loan or cash advance. This is another erroneous expectation. They do not work this way. You must remit the entire balance in accordance with your employer’s payroll cycle. This is normally weekly or bi-weekly – sometimes monthly.

Payday loans do not have a repayment period lasting several months, one year or more. However, you can roll them over as many times as you like. Be advised, the rollover charges add up very quickly. They are a debt trap best avoided.

Individuals fitting into narrow categories can often find a better alternative.

No Upfront Fees

Obtaining a long-term personal installment loan with no upfront fees is another unrealistic expectation for consumers with bad credit history. Even people with the best credentials must deal with origination fees.

Online loans with monthly payments commonly charge origination fees and interest.

  • Origination fees are upfront charges that ensure that lenders cover expenses in the event the borrower repays the entire balance before the end of the term.
  • Borrowers do not pay origination fees before the loan funds. Instead, the investor might fund $475 of a $500 principal amount that the person must repay in equal monthly amounts.
  • Interest charges accrue over time. The higher the rate and the longer the repayment time period, the more borrowing expenses you will incur and pay.

On the other hand, be on guard if any bank requires payment before releasing funds – especially if they request copies of gift cards rather than a check or bank transfer. This type of upfront fee is a sign of fraud. Run away!

Long-Term Personal Installment Loans Good Credit

Long-term personal installment loans are easier to obtain online for people with good credit scores. However, that is not the only eligibility criteria. Consumers need to show a reliable income stream, verify employment, and demonstrate that they can afford the monthly payments.

Request an installment loan here. Be prepared to augment your high FICO score with information about your income, employment, and identity. Online companies need to know that you are a real person with the capacity to repay what you borrow.

Low Interest

Consumers with good or excellent credit scores qualify for long-term personal installment loans with lower interest rates. Banks determine the rate to charge based on three primary factors.

  1. The prime interest rate closely approximates the risk-free cost of money. Every borrower pays at least the prime rate plus a little more.
  2. Banks charge risk-adjusted interest that corresponds to creditworthiness. People with solid credentials have lower projected loss ratios.
  3. The amount of time you hold onto the money increases the risk of future losses. Expect to pay a higher interest rate to lengthen the term.

The Annual Percentage Rate (APR) is a complete reflection of the cost of borrowing money. This calculation includes the periodic interest charges plus the origination fee. The lender should disclose all of these charges in advance.

This comparison table shows up to a 6-point range with the largest gap on the lengthiest repayment period.

YearsLow APRHigh APR
37.5%10.3%
57.5%13.5%

Debt Consolidation

Debt consolidation is a viable use of long-term installment loans for people with good credit scores. Consumers with a history of on-time payment sometimes have very high levels of revolving debt. They also are more likely to meet the requirements for an approval based on their track record.

Restructuring revolving balances into a contract with fixed monthly payments can improve finances in several ways.

  • Borrowers with good FICO scores sometimes qualify for a lower interest rate and save money. You retire your existing credit card debt more quickly when a bigger portion of each payment goes towards retiring principal.
  • Personal loans with longer repayment schedules have smaller monthly payments. Borrowers need good ratings to make the grade for the lengthier terms. The more time you have to repay what you owe, the lower each monthly payment will be.

Debt consolidation gives consumers greater breathing room each period.

Posted 04/17/18 4:23 PM by Kevin Haney MBA