When people get in a financial bind, they may have a hard time qualifying for a loan from a traditional lender such as a credit union or other banking institution. Installment loans for bad credit are available for consumers in need. You will need to provide documentation as with any other loan, but it is possible to qualify for installment loans for bad credit.
How do installment loans work for people with bad credit?
Installment loans are designed especially for people with less than perfect credit. You simply submit an online application, and the lender reviews the information and approves or declines your application. If approved, you will be provided with an amount you are eligible to borrow. You must be at least 25 or older to qualify for the loan. You have several simple requirements you have to satisfy: you must be 25 or older, earn a minimum income amount set by the lender, furnish proof of identity, and provide banking institution information. Some lenders require a shorter repayment period while others may allow you to repay the loan over the course of 12 months or more. Interest also accumulates daily with these loan products. Your loan repayment schedule is assigned at the time the loan is issued, and the first draft made is completed on your payday for short term lenders. Some installment loans may help you build up your credit.
If credit is not used, then what is used to qualify you?
Your income plays the greatest role in your ability to qualify for a loan. Your employment history is evaluated as a part of the application process. Your paystubs are used to determine the amount that you should be comfortable with repaying back. Banking account, proof of identity and proof of residence are all considered during this application process. You will have a hard time qualifying for a loan that exceeds your current earnings because lenders like to minimize risks when lending to people with imperfect credit.
How long does it take to qualify for a loan?
Qualifying for an installment loan with bad credit is simple. Once your application has been processed, you typically get a response within several days. Many applicants can produce a response based on your inquiry in a matter of minutes if the application was submitted online. Once the loan has been approved, funds will be disbursed to your account within one day. Filling out an online form is the first step to qualifying for a loan.
An installment loan for people with bad credit has no minimum credit score requirement. You simply have to provide basic documentation, proof of income, and banking account information to qualify for a loan. Your lender may be a short-term lender, requiring that the loan be immediately repaid. Some lenders may offer you more flexibility in allowing you to repay the loan in several months.