Are you thinking about taking out a short-term loan to help pay off a last-minute expense? Before you do, take the following quick quiz to find out if an installment loan is the right type of loan for you.
Are you thinking about taking out an installment loan to help pay off a last-minute expense? Before you do, take the following quick quiz to find out if this type of loan is right for you.
1. Knowing What’s in Your Paycheck
Having a secure job is a critical component to financial fitness. Without money coming in on a regular basis, it can be tough to pay your bills. But it's critical to understand exactly what your paycheck is comprised of, which includes more than just your wages. Just because you get paid $15 an hour doesn't mean you'll be pocketing that amount. Your take-home pay is what you receive after taxes and deductions have been subtracted.
Take the time to determine the specific deductions that are made, including income taxes, Social Security, Medicare, health insurance, contributions to your 401(k), and so forth. You may not have all of these. Each person’s standard deductions vary. However, knowing what is being deducted will not only help you understand how much you'll actually receive in net income, it can also help with both planning and building for a financially strong future.
2. Saving and Investing Your Money
Even the most diligent and prudent person can find themselves needing some quick money sometimes. Maybe an automated bill payment will be debited from your account right before your paycheck. Such a scenario can set-off a negative chain of financial events where you're always trying to play catch-up. If you are disciplined when it comes to paying your bills on time, an installment loan might be an option to bail you out of a temporary financial hole.
3. Have you been denied a loan from another lender?
Many personal loans have stringent criteria in order to ensure approval, including a high credit score. If you've been turned down for a traditional personal loan from your bank, perhaps you can consider an online installment loan. There's no need for a high credit score, and the approval process is often much simpler and faster.
4. Are you unable to pay back your loan by your next payday?
The ability to access money very quickly - within 24 to 48 hours - is extremely important in a variety of cases, but some short-term loans require the borrowed funds to be paid back by the time you get your next paycheck.
If you are unable to pay back your loan by this time, then an installment loan may be the better choice for you. This type of loan structure allows you to repay your loan in installments over several months. You'll have a longer period of time to pay back the loan and can make much smaller payments rather than repaying in one lump sum.
Many installment loans have no early pay-off penalty. So you may have the option to pay it off before it is due, but you don’t have to. The application process is quick and you have the flexibility to pay it off right away or as the installments come due.
5. How much do you need to borrow?
If all you need is a few hundred dollars, then an installment loan may be ideal, as these types of loans usually involve amounts ranging from approximately $200 to $1,200.
6. How quickly do you need the money?
As long as the necessary information needed is received before the end of business hours (typically 5 pm CST time) and can be verified for approval the same day, you can typically receive your funds as soon as the following business day.
7. Are you at least 18 years of age?
Like most other loan types, you must be at least 18 years old to apply for an installment loan.
8. Do you have a steady income?
In order to be able to comfortably pay back the funds loaned out to you, it's important that you have a steady income that brings in enough money for you to be able to make your regular payments until the loan is completely paid off. You should be able to provide proof of such income when applying for an installment loan. In addition, your bank account should be active and in good standing.
Depending on how you answered these questions, an installment loan could prove to be ideal to help you get out of a financial struggle. They're easy to apply for, at most times approved quickly, and can provide you with the funds you need in as little as 24 hours. When it comes to getting fast money easily without having to pay it all back in one lump sum in a short period of time, an installment loan may be the right option for you.