Best Online Personal Loans and Installment Loans in 2024: An installment loan is referred to as lump sum money borrowed and then repaid in fixed amounts or installments with interest. Learn more about the features of an installment loan and how to compare your options to discover the best match for your particular circumstances.
What Is An Installment Loan?
A loan that is repaid in installments is an installment loan. Generally, the payments are equal and paid monthly or quarterly. Installment loans were first created to assist individuals in purchasing furniture, appliances, and gadgets when they lacked the funds to pay for them all at once. Today, however, installment loans may be used for various purposes, including credit card debt repayment and consolidation of high-interest debt.
An installment loan provides you with the loan amount up front and a due date. You repay a part of the borrowed amount plus interest with each loan payment.
In contrast, revolving credit enables you to borrow up to a certain amount, return it, and then borrow again and again indefinitely. For example, Credit cards, personal lines of credit, or home equity lines of credit, known as HELOCs. An installment loan is an ideal choice when you know how much money you will need. Another key advantage is that installment loans are often less expensive than their revolving competitors in terms of interest rates.
Types of Installment Loan
There are several installment loan options, both secured and unsecured.
1. Secured Installment Loan
A secured loan is guaranteed by the borrower’s collateral, such as a house or a vehicle, which the lender may sell to recover losses in the event of default. Mortgages, home equity loans, and vehicle loans are examples of typically secured installment loans.
2. Unsecured Installment Loan
Unsecured installment loans do not demand collateral, so you do not risk losing significant assets, such as your house or vehicle if you cannot repay the loan. Personal loans and student loans are typical unsecured installment loans.
Typically, secured installment loans offer lower interest rates than unsecured options since the collateral decreases the lender’s risk. Borrowers are not required to put a house or vehicle up as collateral, but getting the loan may be difficult. The approval threshold for unsecured loans will be higher.
How to Find Installment Loans with Good Interest Rates
Here are some actions you may take to get the lowest possible interest rate:
1. Improve your credit
Most lenders use risk-based pricing, which means that your interest rate is directly proportional to the probability that you would fail on the loan—the greater one’s credit score, the less probable that one will miss payments. So, examine your credit score and credit report to understand where you stand, and then take action to fix credit difficulties and improve your score.
2. Shop around
With most installment loans, the criteria for calculating the interest rate will differ from lender to lender. The exception is government student loans, which give uniform interest rates to all qualified borrowers. Use prequalification options to browse and compare offers without a credit check. But make sure you’re comparing apples to apples. Compare variable rates with other variable rates and fixed rates with other fixed rates. Lenders may provide both loans but operate differently and may involve different fees.
3. Offer a larger down payment
A larger down payment might reduce the interest rate when taking out a loan to purchase a vehicle or a house since it demonstrates your commitment. Just be careful to maintain an emergency fund balance in your savings account.
4. Apply with a co-signer
You can apply for a loan with a co-signer to increase your probability of being approved for the loan or to qualify for more favorable conditions than you could on your own. If you pursue this option, you should apply alongside someone with an excellent credit history.
5. Opt for a shorter repayment period
Lenders often charge higher interest rates on loans with long payback periods to account for the possibility that interest rates could increase over time, resulting in a loss of revenues. Although a shorter payback time results in a greater monthly payment, total expenditures are reduced due to a lower interest rate.
Payday Loans vs. Installment Loans
People with low credit may believe their financing options are limited and turn to payday loans to quickly get cash. In contrast to installment loans, payday loans typically need a single payment within 14 days after loan disbursement.
Depending on where you reside, payday loans can charge high-interest rates, with APRs that may reach as high as 664%.
Most consumers need more time to repay payday loans due to high-interest rates and the inability to make installments. Unfortunately, the outcome is increasing interest charges, making it more challenging to repay the loan. “The more you consider payday loans, the more likely you are to fail, don’t you think?”
If you intend to apply for a payday loan, take the time to consider other choices, such as loans from your local credit union or personal loans. You may also try contacting local organizations that provide financial assistance in an emergency.
Where Can I Get an Installment Loan?
A bank, credit union, or internet lender may provide you with an installment loan. However, the best way to get an installment loan is through internet lending services since they have fewer requirements to qualify and will not affect your credit record with hard credit inquiries.
Only a few lenders provide installment loans without security. You may locate and visit one of these companies to submit a loan application in person. For the loan to be approved, you may need to provide a lot of documentation.
Top 15 Best Installment Loans in 2024
Here we list some of the best Installment loans companies you can consider in 2024.
1. OneMain Financial
OneMain Financial is among the best installment loans provider. A personal loan is one option to cover various life needs, such as debt reduction, vacations, and medical bills. A OneMain personal loan has set rates and payments. The rate and product for which you are eligible are determined by some variables, such as loan amount, term length, credit history, income, spending, other financial responsibilities, and the availability of collateral (such as a vehicle).
Once we have basic financial, employment, and personal facts, you’ll receive a rapid answer on your loan request. After approval, we will explain your alternatives and verify your identification, income, expenditures, and any required collateral by phone, online, or in person. Then, after reviewing and agreeing to the terms of your loan, you will sign the loan paperwork and get the funds. It’s that simple.
Website: https://www.onemainfinancial.com
2. Upstart
Upstart is an online lender that provides affordable installment loan options to borrowers with excellent or average credit. You may apply for a loan online and get the funds the next business day. Upstart has no minimum credit score requirement.
Upstart provides just two installment loans duration, 36 or 60 months, and a large selection of fixed interest rates. You may be subject to higher interest rates if you have a low credit score. In addition, there is an origination charge ranging from 0% to 10%. Unfortunately, Upstart does not permit co-signer applications to modify terms. You may be eligible for an Upstart personal loan if you have bad credit but a reasonable salary. Keep an eye on the costs.
Website: https://www.upstart.com
3. Happy Money
Happy Money is an online lender targeting individuals who need to consolidate high-interest credit card debt with installment loans. There are no prepayment, application, or late fees associated with these loans. Interest rates start at 8.99% APR. Since Happy Money only provides credit card debt consolidation loans, borrowers may concentrate on settling current debt and improving their credit ratings.
Website: https://happymoney.com
4. SoFi
In addition to its well-known student loan refinancing solutions, SoFi provides installment loans with longer payback terms. SoFi provides unemployment insurance that enables you to temporarily suspend your monthly payments for up to a year if you lose your job.
Website: https://www.sofi.com
5. Avant
Avant specializes in installment loans for individuals with fair to low credit, so if your score falls within this range, it may be a viable alternative. With interest rates beginning at 9.95 percent APR, it is feasible to get a decent rate and save money on loans for debt consolidation or any other purpose. Avant has the lowest minimum FICO credit score of all the lenders reviewed on this page: 580.
Website: https://www.avant.com
6. Regions
Regions is a bank with rather stringent credit standards, but it permits cosigners to help you qualify and get better terms and interest rates. You may submit a loan application online, over the phone, or in person at one of Regions’ local locations.
Installment loans ranging from $2,000 to $50,000 can be used for almost anything, including home repair, credit card debt repayment, and automobile purchases. Rates begin at 7.99%, close to the lowest accessible; however, a cosigner may be required to get this APR. In addition, there is a 5% or maximum $100 fine for late payments.
Only Arkansas, Alabama, Florida, Georgia, Indiana, Iowa, Illinois, Kentucky, Louisiana, Missouri, Mississippi, North Carolina, South Carolina, Tennessee, and Texas can access the Regions bank.
Website: https://www.regions.com
7. First Tech Federal Credit Union
First Tech Federal Credit Union is a nationwide credit union that provides banking services and personal loans for a range of reasons to its members. You may borrow up to $50,000 with loans beginning at $500. First Tech may be a decent option for those with average credit since their minimum credit score requirement is 600.
The repayment duration offered by First Tech FCU vary from two to seven years, and interest rates are low. The disadvantage of longer-term loans is that the minimum interest rate will be somewhat higher, although this is common among lenders.
First Tech installment loans membership is required to apply, but joining is simple and available to anybody. Overall, First Tech is an excellent alternative for anyone with less-than-perfect credit who need an installment loan.
Website: https://www.firsttechfed.com
8. LendingClub
LendingClub is a well-known online lender that provides debt consolidation loans with reasonable interest rates and up to $40,000 in loan amounts. In addition, LendingClub will pay your creditors directly to repay your outstanding obligations and combine them into a monthly payment. LendingClub installment loans provider enables borrowers to check rates using an online prequalification tool, which involves a soft credit draw and will not affect your credit score.
Applicants with exceptional credit are eligible for the lowest rates, although the top end of the spectrum is relatively steep. In addition, a 3 to 6 percent origination charge is added to each loan, so check the estimate before signing up. The cost might render consolidation inadvisable if you do not get a lower interest rate overall.
Website: https://www.lendingclub.com
9. LightStream
LightStream is an online lender that provides up to $100,000 in big installment loans at low-interest rates. In addition, personal loans from LightStream include flexible payback periods (up to 10 years) and no origination fees (no application, origination, prepayment, or late payment fees). LightStream provides same-day financing on select loans so that you may get your funds on the same day you sign your loan agreement.
LightStream does not provide prequalification; therefore, you must complete a full application to see your rates and loan conditions. However, the lender will only lend to people with good to exceptional credit, so if you have fair or poor credit, you will need a co-applicant to increase your chances. It provides substantial loans at reasonable rates, but you must have an excellent credit history to qualify.
Website: https://www.lightstream.com
10. PenFed Credit Union
PenFed is a national credit union that provides various financial services, including personal loans. It offers loans to its members, allowing them to borrow anywhere from $600 to $50,000 with no collateral required.
The PenFed prequalification tool allows you to see your rates without affecting your credit score. However, although non-members may see their rates, membership is required to qualify for a loan and obtain cash. It is easy to become a member; you will be invited to do so throughout the loan application process by starting a $5 account.
PenFed Installment loans offers reasonable interest rates to qualifying borrowers, but a minimum credit score of 650 is required. The maximum accessible rate is 17.99%, cheaper than most rivals (including credit cards); therefore, PenFed may be a decent choice for debt consolidation.
Website: https://www.penfed.org
11. Wells Fargo
Wells Fargo is a well-known bank that gives its members up to $100,000 in personal loans. With rates as low as 6.99%, members get installment loans with some of the most competitive rates available.
Loans from Wells Fargo may be used to consolidate debt, pay for a wedding, or make home improvements; they can be used for anything. Loans cannot be used to refinance student loans or for postsecondary education. However, with terms ranging from one to seven years, you have numerous repayment choices.
Only existing Wells Fargo clients may apply for installment loans online; everyone else must visit a branch location. You may examine your rates and loan conditions online without affecting your credit score before completing a complete application.
Website: https://www.wellsfargo.com
12. Marcus
Marcus by Goldman Sachs is a bank that provides $3,500 to $40,000 in installment loans with low-interest rates to borrowers with excellent credit. No costs are associated with loans, including origination, prepayment, application, or even late payment penalties. Repayment lengths for loans range from one to six years.
Goldman Sachs, a financial institution in business since 1885, backs Marcus. It gives borrowers confidence in the integrity of the loans offered by Marcus and the security of any funds maintained in Marcus accounts.
Marcus loans are accessible in all 50 states and the District of Columbia.
Marcus installment loans does offer cheap rates, but to qualify for the lowest rates, you must have a strong credit score and a solid credit history. It would help if you also enrolled in auto-payment. Marcus may also need several days to finance loans, whereas other rivals provide same-day financing. Nevertheless, Marcus is a terrific alternative for borrowers with excellent credit seeking the lowest rate on a personal loan.
Website: https://www.marcus.com
13. Best Egg
Best Egg is an excellent option if you’re seeking specialized loan features to address specific circumstances; it provides more additional features than other lenders, offering you alternatives if needed. It provides qualifying borrowers with installment loans of up to $50,000 with a minimum credit score requirement of 600. Overall, Best Egg is an excellent alternative for borrowers seeking anything beyond a conventional loan.
Website: https://www.bestegg.com
14. ThinkWallet
ThinkWallet is focused on assisting you in securing the finest personal loan from a reputable lender. Although lenders’ qualifying conditions are similar, the terms of their loans vary depending on their individual needs. With a personal loan, you can better manage large expenses.
You are seeing actual and genuine rates. Each lender provides rates that vary but are real. No dishonesty. No hidden costs. Choose a product and see your customized pricing. Using ThinkWallet to compare rates is entirely safe and free.
Website: https://thinkwallet.com
15. SAIL Loans
Start your road to financial health with SAIL Loans. They provide online and in-store services, financial education tools, and outstanding customer service. Apply for up to $4,000 additional funds and increase your savings now!
Complete the application for an installment loan and get approved for up to $4,000 within minutes of submitting your details. Most of your funds will be put immediately into your bank account, while the remainder will be held in a secure account that you can monitor via our client portal. After you have paid your loan in full, you will have complete access to your funds. You can consider it among the best Installment loans provider in 2024.
Website: https://www.sailloans.com
Are There Other Alternatives to Installment Loans?
1. Credit card
Charge purchases to a credit card and pay for them over time, or pay the amount in full before the due date to avoid interest charges. Know that carrying a large amount may be subject to high-interest rates.
2. Personal credit line
It is a variable-rate, unsecured, revolving line of credit that acts similarly to a credit card. You borrow as required, repay, and borrow again so long as the line of credit is active.
3. HELOC
Like a credit card, a HELOC is a revolving source of cash that may be used as required. The loan is secured by your house, which allows you to get a reasonable interest rate but puts you in danger of losing your home if you default.
4. Payday alternative loans
Federal credit unions provide this short-term loan as an alternative to payday loans if you need a method to meet ends.
Final Words
The loan that has a fixed interest rate and is payable in equal principle and interest payments is an installment loan. At the end of the period, the loan is returned in full (e.g., three or five years). Installment loans may be secured with assets (such as a vehicle) or unsecured. Unsecured loans are more costly than secured ones because the lender assumes greater risk when issuing them.
Consider an installment loan if you need the funds to make an essential purchase but have sufficient income to repay the loan within a short time frame, often three to five years. A person may also use an installment loan to consolidate debt with higher interest rates into a single loan with a lowered interest rate. It might facilitate a quicker repayment of the loan. We have assembled a list of the best Installment loans online for your convenience.
