June 8, 2020
What is an Installment Loan and Where Can I Get One?
Qualify for a Bad Credit Loan in Kansas City
Making a large purchase, like a car, or paying down credit card debt seems like an insurmountable task for people with a checkered credit history. Personal loans from traditional lenders in Kansas City, like banks or credit unions, can be difficult to qualify for if you have a high debt-to-income ratio or a low credit score. Getting out of a financial hole requires careful planning and balancing your monthly budget. And without a loan, purchasing a vehicle or consolidating debt can be impossible.
However, you can secure a longer-term loan, even with poor credit or no credit at all. Installment loans available at Midwest Title Loans at 85th and Wornall allow you to make regular monthly payments for up to 24 months to finance a purchase or pay off your credit cards and ultimately work toward achieving financial freedom.
How Does an Installment Loan Work?
The term “installment loan” is just a fancy term for a personal loan. Any loan that is repaid with regularly-scheduled payments and consistent payment amounts is technically an installment loan. That means funding like fixed-rate mortgages and auto loans are installment loans, too. They’re a perfectly normal and widely-accepted means of getting money when you need it.
There are two kinds of installment loans you can get, even with bad credit. The first is a collateralized loan. With this type of loan, you must be borrowing money to make a purchase, such as a vehicle, for example. The item you are purchasing with the loan becomes collateral for the loan. Non-collateralized loans, conversely, are personal loans that do not require you to put up anything for collateral, and are given solely based on your ability to repay the loan. Often, non-collateralized loans have slightly higher interest rates because there is a higher risk of non-payment. Commonly, non-collateralized personal loans are used for consolidating credit card debt or paying urgent, unexpected bills.
Your payment on an installment loan goes toward repaying a portion of the principal, or original amount of the loan, and interest that your loan has accrued. Your monthly loan payment amount is determined based on the original amount of your loan, your loan’s interest rate, and the length, or term, of the loan that you choose during the application and approval process.
If you’re seeking fast cash in Kansas City, an installment loan might be your best choice. To qualify for an installment loan from Midwest Title Loans, you must first fill out a credit application. You will need to indicate why you need the loan, as well as the amount of money you are seeking. We ask that all loan applicants be at least 18 years of age and provide proof of employment.
After you apply and are approved, we will work with you to choose a loan term, or the number of months you have to pay back your loan, as well as the amount of each monthly payment. Our loan terms can be as little as a few weeks and up to 24 months.
When we settle on loan terms and you sign your loan paperwork, we will provide you with your money. Then, you simply make your regular payments for the duration of your loan term. With an installment loan, there is no penalty if you pay it off early or make extra payments. You will only make payments and accrue interest while you have your loan.
Although we do not report your title loan or payday loan to any credit bureau, like Equifax or Experian, we do let them know when you’ve taken out an installment loan and are repaying it on schedule. As you make regular payments on time and in full, you might see an improved credit score at the end of your loan term.
Advantages of an Installment Loan
Installment loans provide many advantages over short-term loan options, like payday loans or car title loans, namely because they can be tailored to fit your specific needs. For example:
- You choose your monthly payment amount and loan term that will best work with your budget.
- Monthly payment amounts never change, so there are no surprises during repayment.
- Interest rates on installment loans tend to be lower than other types of loans, including credit cards.
- Your credit score can increase as you long as you make on-time payments in full.
The only real disadvantage of a long-term loan is that you will need to ensure you are ready to repay your funding over time. However, if you have steady employment and are comfortable making a monthly payment, this disadvantage is not an issue and can help you affordably and quickly overcome financial burdens, like high credit card bills.
Can I Get a Loan with Bad Credit?
The answer to this question depends on which lender you work with to apply for an installment loan in Kansas City, Missouri. If you speak to a loan officer at a bank, for example, their policies may require that you have a specific debt-to-income ratio or minimum credit score before they’ll consider extending credit to you.
However, if you visit Midwest Title Loans, we are much more lenient about your credit history! We understand that just because your credit score isn’t perfect does not mean that you are unable to repay your loan. We want our valued clients to find the same financial peace as anyone else, because everyone deserves that feeling and stability! Come let us work with you to find the perfect installment loan options to fulfill your dreams.
Who Offers Installment Loans Near Me?
Midwest Title Loans has been operating in the Kansas City metro area for more than 25 years, and our friendly customer service means our clients come back to us when they need financing, as well as recommend us to their friends and family. Learn more about us.