If you exhausted your emergency fund and are now looking for emergency funding, you’ve come to the right place; with our application process, we can help you find several loan offers to address your financial crisis.
In this guide, we’ll discuss emergency installment loans, what they are, how they work, what different types of emergency installment loans there are, and some of the biggest benefits of securing an emergency instant loan.
What Are Emergency Installment Loans?
Emergency installment loans are mid-term personal loans in which you borrow a sum total (often substantial) and pay the loan back in smaller monthly payments, called monthly loan installments.
These are paid back throughout the repayment term until the loan is paid in full, along with the interest and the associated fees. Installment loans are generally a much better loan option for covering various types of unexpected expenses and financial needs, since they have lower interest rates compared to short-term, small-dollar loans, such as payday loans.
These unexpected expenses and financial needs often include employment termination, car repair, debt consolidation, medical bills, and moving expenses. There are also different types of emergency installment loans, but nearly all work as previously described.
What separates emergency installment loans from typical installment loans is the speed at which the loan is funded. Unlike traditional financial institutions, which are notoriously slow when it comes to loan application processing and approval, online lenders offer a much more expedited service, with same-day or next-business-day funding.
It’s also worth mentioning that some online lenders offer online installment loans to customers with bad credit scores. Poor credit has always been an excluding factor for certain borrowers, preventing them from securing a loan from a traditional lender. However, no-credit-check financial solutions allow these borrowers to access different funding options, and resolve any financial emergencies they’re facing.
These non-traditional financial options often come with lender- or loan-specific requirements, such as higher interest rates, less favorable repayment terms, limited loan funds, and perhaps additional fees or penalties—all of which depend on the lender, type of loan, and even state in which the loan is obtained.
Benefits of an Installment Loan for Emergencies
Emergency bad credit loans are a popular loan option since they provide several benefits to potential borrowers, especially those without a spotless credit report. Here are the benefits of emergency installment loans:
Funding Speed
One of the greatest benefits of emergency instant loans is the loan funding speed or the time that it takes for the lender to process your loan application, approve the loan, and load the funds into your checking account.
Most emergency lenders take less than a few hours to review your loan application and decide on approval, and many offer same-day funding. However, working hours, weekends, and holidays apply; these should be taken into consideration, in which case your loan can be funded on the next business day.
They’re Online
Thanks to the advancement of the internet, many lenders are now offering their loan products and financial services online. This allows borrowers to pre-apply and complete the loan application process and loan approval process entirely online, from the comfort of their homes, using nothing else but their favorite personal electronics. It also eliminates the need to visit a local branch office, though that’s always an option, assuming that the lender has one.
They’re Predictable
Emergency installment loans are predictable when it comes to repayment; you know the amount you have to repay by the due date, which makes budgeting much easier. The option to repay the loan in monthly installments also provides borrowers with more stability and prevents unpleasant surprises.
This is particularly beneficial when compared to other loan types that might not be as flexible as installment loans, both in terms of borrowing and repayment.
No Entrapment
Unlike payday loans, which often come with exorbitantly high APRs of up to 400% or even more, installment loans come with much more affordable interest rates, which significantly reduces the chances of entrapment.
The predictability, transparency, and payment structure associated with emergency installment loans ensures that the borrower always understands exactly what kind of loan product they’re obtaining, what their contractual obligations are, what type of loan works best for them, and what amount in monthly installment they have to pay back.
Admittedly, the terms of emergency installment loans might be less favorable compared to secured installment loans provided by traditional lenders, but for those who need a reasonable, transparent, and fast loan, emergency instant loans are a good financial solution to emergency expenses.
Convenience
The online application process eliminates the need to visit a local branch office. Your loan application is usually reviewed in a couple of hours, leading to the loan funds being deposited shortly after you sign the loan agreement.
Further convenience depends on several different factors and may differ from one lender to another. In most cases, lenders allow you to borrow any amount of money up to their maximum, and the eligibility requirements for the loan aren’t usually based on your credit score or credit history.
The speed of funding and the lack of hard credit checks is what makes these loans convenient, especially for borrowers who are either in a hurry, have a bad credit score, or both.
Emergency Installment Loans Options
There are several different types of installment loans, but since we’re discussing emergency installment loans, we’ll primarily discuss those that prioritize funding speed.
All loans are split into two main categories: secured loans, those that rely on collateral, and unsecured loans, which don’t require collateral but rely on your credit score for eligibility. Emergency installment loans are typically unsecured loans, but instead of relying on credit score, the lender grants the loans with higher interest rates due to a perceived higher risk.
However, those aren’t the only loan types of fast-funding loans. Here are some of the most viable emergency installment loan options:
Payday Loans
Payday loans, also known as cash advancements, are short-term small-dollar loans that are typically repaid by the borrowers’ next paycheck. These loans often have limited loan amounts, which typically range between $200 and $1000, and come with exorbitantly high interest rates.
Since they’re not financially viable to traditional lenders, these loans are most commonly offered by online lenders and often come with exorbitantly high interest rates, which makes them very expensive and sometimes really difficult to repay.
It’s also worth mentioning that some direct lenders, such as banks and credit unions, offer payday loans at reasonable rates with fast funding. However, they do require that you have a good credit score.
Unsecured Credit Cards
Unsecured credit cards for bad credit allow users to make purchases with the cost of goods and services added to their lines of credit, as opposed to a debit card. While they may allow customers to defer payments, these also come with hefty interest and monthly repayment schedules and aren’t as versatile as cash loans.
Car Title Loans
Car title loans, also called auto loans, are secured loans since they’re backed up by collateral; you’re submitting your vehicle’s title to the auto lender in exchange for the loan. This allows you to continue driving your car for the duration of the loan while a lien remains on the title until the loan is repaid in full, along with the interest.
There are several requirements associated with auto loans: you must be the sole owner of the vehicle or secure the co-owner’s approval to qualify for the loan. Car title loans come in different forms, and though they’re mostly short-term, mid-term, and even long-term options do exist, making them akin to secured installment loans.
The loan approval process is typically fast and usually completed in under a few hours. Most lender companies feature an online application form. However, there’s a significant drawback: if you default on the loan, the lender has the right to repossess your vehicle as collateral.
Unsecured Installment Loans
Unsecured installment loans are long-term loans aimed specifically at borrowers facing an emergency financial situation. However, these have the added benefit of fast application processing and approval, with the entire process being handled online.
You’re still expected to provide the necessary documents to establish eligibility and gain approval. We expedite this process further by allowing you to submit your online application form, which we then share with our associate lenders. It’s like applying to different lenders at once.
Once our lenders review and approve your application, they’ll contact you with the loan offer and loan terms agreement. It’s also not uncommon for our clients to receive several different offers from different lenders.
Frequently Asked Questions
Find answers to some of the most commonly asked questions about emergency installment loans below. For any further assistance or inquiries, feel free to reach out.
The fastest way to obtain an emergency installment loan is to apply for the loan with an online lender. This is because traditional financial institutions tend to be slow when it comes to loan application processing and loan approval, which may take days to complete; not an ideal solution when you’re in a financial pinch.
Online lenders are much faster when it comes to application processing and approval and usually have less stringent requirements, but such service often comes associated with higher interest rates and less favorable loan terms.
There are emergency installment loans specifically aimed at potential borrowers with bad credit and poor credit scores. These loans range from short-term small-dollar loans to long-term loans with sizable loan amounts and often imply higher interest rates and less favorable terms, though it greatly depends on the type of loan.
In most cases, your online lender will charge you with late fees and penalties for missed payments, which will undeniably have an adverse effect on your credit score. If the situation worsens and you fail to catch up with the current installment, you’ll likely default on the loan, in which case the lender (depending on the type of the loan) might seize your property or initiate legal action against you.
However, you can always seek refinancing options with your lender. While not ideal, refinancing will allow you to continue to repay your loan in more accessible installment amounts in exchange for a longer loan term and even higher interest rates.
Yes, emergency installment loans are safe financial products. Most states limit the interest and APRs associated with installment loans for bad credit. This limits the APRs to a maximum of 36% to protect borrowers and consumers from predatory lending practices. The caps don’t apply to other loan products, and small-dollar short-term loans, such as payday loans, often come with exorbitant APRs and interest.
Unless you’re in a financial emergency in which you really need fast cash, there are several viable alternatives to emergency installment loans. Some of these can be obtained from traditional financial institutions only and may include but not be limited to lines of credit, various types of secured loans, credit union loans, and credit card cash advances. Alternatively, you can also borrow from friends and family, but have the agreements notarized and keep all the receipts.
Summary
Emergency installment loans are specifically aimed at borrowers with spotty credit history, looking for emergency funding whose amounts can’t be covered by payday loans or other short-term financial products.
If you’re hard-pressed by your financial emergency and need to find an emergency installment loan, we can help you secure the best loan option in the least amount of time necessary. Just head over to our website and fill out the inquiry form.
We’ll share your application with our vast network of associate lenders, increasing your chances of securing an emergency installment loan, further enabling you to sift only through the best loan offers possible.
