What You Need to Know about Installment Loans from an Installment Lender in Mississippi
Though the phrase itself might be lesser-known, the truth is, installment loans are very prevalent in society today. Auto loans, mortgages, personal loans — any type of loan that allows an individual to borrow a fixed amount of money at a set interest rate is an installment loan. Payments on the principal, called installments, are usually made per month but can differ depending on the terms set by the installment lender. In Mississippi, many places offer this type of loan.
Installment Loan Benefits
The main benefit of this type of loan is the fixed payments associated with it, as these will remain the same payment to payment. Because you will know ahead of time the exact amount expected of you, you can determine the amount you can borrow so you won’t stretch yourself too thin financially. When speaking with an installment lender, it’s important to remember that financial emergencies can and will pop up from time to time, so be sure you only borrow what you can afford.
Installment Loan Drawbacks
While this type of loan is usually used as a pay advance for a specific item, remember it’s a fixed amount of money, meaning you can’t borrow additional money under the same loan as you could with a line of credit. If needed, you would have to speak with an installment lender in Mississippi to take out an entirely new loan, and another set of payments along with it.
Additionally, the terms of your loan, including your interest rate, will be based on your credit score. This could work out in your favor if you have good credit, but if you’ve struggled with making payments in the past, it will have an adverse effect on the conditions of your loan. Some lenders also tack on additional fees for applications and credit checks, which you must pay upfront, and some even charge prepayment penalties if you pay off the loan sooner than the original date.