Why Installment Loans Make More Sense than Payday Loans

Everyone remembers when payday loans were being advertised everywhere. It didn’t take long for borrowers to realize, however, the disadvantages of these loans. Installment loans offered by Maxlend Loans are a much safer and more sound option for people who need money now.

Payday Loans

People were drawn to payday loans because of their promise of fast cash. Just about anyone with a job could get approved for a payday loan. Money would be deposited into the borrower’s account, often on the same day. These promises made countless people rush over to get this hassle-free quick money.

However, payday loans do have one catch, and it’s a big one. Most lenders require borrowers to repay their loan off in full when they receive their next paycheck. If they can’t, more fees are added, and the cycle continues over and over again. Some people even take out additional loans to repay their initial payday loan.

Installment Loans

Just like payday loans, installment loans don’t require good credit, or even any credit at all. Applicants simply have to prove they are employed, receive a steady income and have a regular checking account. People can get money in a single business day.

While installment loans may seem very similar to payday loans, they do have a huge advantage. Instead of being required to repay in full right away, installment loans allow borrowers to repay their loan over the course of several months. Equal payments, or installments, are due on a set schedule.

Borrowers do pay interest in an installment loan, but since payments are smaller, most people are able to stick to the repayment schedule without defaulting. Interest rates are usually fixed, and many lenders allow these loans to be paid off early. Borrowers should always read the terms of their specific loan.

Getting a loan is sometimes the best option for someone who is facing a financial burden. While payday loans promise quick money, they are often difficult to repay without accruing extra fees and penalties. Installment loans, on the other hand, make it easy to repay the loan over a longer period, while still giving people access to fast cash.