If you have bad credit but need money now, payday installment loans are one way to get it. There's no credit check, and you can pay back the loan over several months. You can find them online from lots of places by searching for payday installment loans or no credit check installment loans or something like that.
For example, at this company, you might be able to receive a loan up to $1000, even if you have no credit history, poor credit history or a bankruptcy in your past, as long as you have a job or other source of income and a checking account.
The idea is pretty simple: you apply for the loan online. Since there's no credit check with any of the big-three credit bureaus, it doesn't matter if you have no credit history, a bad credit history or even bankruptcy. You'll get approved quickly if you have a regular paycheck or income that's direct-deposited into your bank account.
When you're approved, the money will be sent electronically into your account in a few hours or by the next day. You can schedule payments to correspond with your paydays, and the loan will be paid off in a few months.
So What's the Catch?
Well, like most loans for people with bad credit, the interest rate is high. That's really the main catch. The maximum amount you can borrow might be around $1,500 or $2,000, and the maximum time to pay back might be six months or so.
Loans for more money or for longer terms are available, but for them, the lender might need to do a credit check and see that you have a credit score above 500 or so.
Some states have single-payment payday loans, short-term installment loans up to six months or so, and longer installment loans for lower interest. Even in states where interest rates aren't highly regulated, the federal Truth In Lending Act applies, so the lender will need to tell you the interest rate you'll be paying.
That's about it. The big catch is the cost. As usual, make sure you're getting a loan from an honest company (check for complaints online, and with the Better Business Bureau, you know the drill.) There are lots of consumer resources to help you.
But if you need the money, and your credit isn't good enough to get a cheaper loan from a regular bank, and you need more time to pay back than just till your next payday or there aren't any payday loans available in your state, an installment loan is the solution.
Why Installment Loans Are a Big Thing
Payday installment loans are such an obvious solution to an obvious need, it's no wonder they're offered. However, it's kind of funny why companies started advertising them more lately.
In a few states, regulators decided they didn't like payday loans, because lenders were charging too much. Somehow it's okay if banks charge $35 when you bounce a check, but heaven forbid a payday loan company charge you $15 to borrow money to prevent a check from bouncing. Go figure.
But anyway, regulators in some states decided to limit what lenders could charge for payday loans. They set the fees so low that the lenders couldn't afford to stay in business. Payday loan stores are fine in the state where I live, but across the state line, a lot of places closed up a few years ago when the laws changed. Regulations come and go, so what's happening in your state may be different than a year ago or a year from now.
Since a lot of people roll over payday loans anyway, lenders who couldn't offer payday loans in their state decided to switch to installment loans. The longer term gives people a little more breathing room to pay the loan back, it fits with the new regulations, and everything's cool.
Well, maybe the regulators are a little pissed that people with bad credit are still allowed to borrow money, but they'll get over it.
9:41 p.m. March 1
That's certainly an interesting spin on the topic.
10:00 p.m. March 1
10:16 p.m. March 1
Payday installment loans, like Credit Service Organizations in Texas, are simply exploiting loopholes in laws that were meant to shut down payday loans. They're utilizing the same predatory lending tactics and targeting the same demographic.
10:38 p.m. March 1
Because there's a demand for their services. It's like Prohibition or outlawing marijuana. Outlawing something doesn't make it cease to exist. As long as there's a demand, companies will provide it and people will use it. I'd rather see a company legally adapting their services to new regulations than operating illegally. And if you want to talk about being predatory, let's talk about bank and credit card fees.
11:01 p.m. March 1
Interesting you'd bring up alcohol and marijuana, because that's the exact reason that payday loans are being regulated out of business. The government has an obligation to protect people from their own poor choices.
9:41 p.m. March 1
See, I think it's just the opposite. People should have the freedom to make their own choices, and if the government wants to help, let it a) regulate businesses to disclose fees and terms so people can make informed choices and b) place penalties on businesses that lie, steal and are generally dishonest. The government should not step between two adults who want to enter into a contract, as long as they're both properly informed and both comply with the terms.
If somebody needs to borrow money, they ought to have a right to do so, and if somebody wants to loan money, they should have that same right, and both should have the protection of the law, not have to go outside the law to do it. So how far away from the topic are we now?
Okay, bottom line: If you need money right now and you have bad credit, you can apply for a payday installment loan and get a quick loan that you can pay back over your next few paydays. Be aware that it may be expensive, so do it only if necessary, but it's one quick and simple solution. Sheesh. How hard was that?
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