Subprime credit is often the last resort for borrowers who have low credit ratings, high levels of debt, delinquency record, a record of defaulting to bankruptcy, and a lack of assets appropriate for using as collateral.
When low-income households are at the brink of a hard time ahead, subprime credits often appear as the only social good, providing the necessary financial means to keep them afloat. The most popular resort for borrowers in the subprime market in today’s time probably comes in the form of an online instalment loan.
This form of debt has a longer span of maturities, but in most cases, it remains uncompromising with the triple-digit interest rates. While payday loans are often resorted to by low-income groups in the face of sudden expenditures, installment loan online with Personal Money Network comes as a godsend to those who have found their wages held-up and bills piling up unpaid.
General Eligibility Criteria for Online Installment Loans
As with applying for a loan in a bank, you have to meet certain criteria for age, occupation, and income, to be considered eligible for a loan online. If you need a personal installment loan, most online lenders would ask you to cite a regular income source. However, some lenders also make an exception for those within a stagnant wage situation.
The specifications based on which you will be considered eligible are– determination of having an income source– whether you are a salaried individual, engaged in a self-employed business setup, or a professional, the company you are associated with, and your personal credit history among other things.
Types of Installment Loans: Which One Are You Eligible For?
Broadly speaking, installment loan refers to the sum that you borrow and make the payback with fixed amounts, as installments over some time. The term is more often determined by the lender, though with some online money outlets, you can appoint the payback time according to your convenience as well.
The concept of installment loans is quite different from the purchase by credit card which lets you borrow funds every time you make a purchase, but do not transfer a sum you need to your account.
Based on the term over which the borrowed sum has to be paid back, which may be as brief as two-weeks or as long as 30 years, the types of installment loans are the following–
Personal Installment Loans
These loans can be offered by banks, credit unions, and even online lenders. Online lenders are the best option for you if you are looking not to specify your reasons in too much detail. Most often people take them for consolidating credit card debt. Credit card consolidation is a strategy involving the combination of various credit card balances and rolling them into one monthly payment.
This was, the new debt made has a lower percentage of annual payback rates than that on your credit card. This way payment is made more manageable, and the payoff period shortened.
You will be eligible to take a personal loan at Personal Money Network, if you can tackle a rate of interest ranging from 6% to 36 %, over a term of two to five years. Rates, terms, and specific loan features vary from lender to lender at this wide network. To calculate your general eligibility and find you a deal that is perfect for your circumstances, you can find different tools of comparison by the algorithm.
Most online lenders at this forum allow borrowers to pre-qualify by a rough credit check. Fear not, his kind of checks will not affect your credit score!
Auto Loans
Loan for a big emergency car repair stretching your monthly budget is a situation that perhaps every householder has to face at some point or the other. Such a case scenario requires auto loans, generally offered by banks, dealerships, and online credit unions. You will be eligible for an auto loan when interest rates between 3 % and 15 % can be accepted. You have to have a credit score of 750 or above to get approved.
Home Loans
Only a regular source of income and a good credit score can make you eligible for a home loan or mortgage. The usual terms of mortgage extend from 15 to thirty years. With online lenders, you will usually have the choice of opting between a fixed rate of interest or an adjustable yearly/monthly rate of interest.
Non-Credit-check Loans
These will not scan your credit score before extending a loan; neither do these online lenders demand an elaborate citation of your borrowing reasons. However, the lax eligibility criteria of no-credit-check loans often come with a catch. High rates of interest and additional fees might be the hidden peril in going for such a loan.
Also, most of these loans come with a short-term payback condition, which might be tricky to sufficiently meet. Advisably, such a loan should be considered only after ruling out other options.
How Much Are You Eligible to Borrow?
The primary determinant of this subject is the amount of your regular income. The next factors that come into consideration are whether you are a salaried employee or self-employed. The usual calculation on the part of the lender will be to restrict the amount you borrow so that your EMI doesn’t exceed 40-50% of your income.
If you are self-employed, the loan amount is decided on the rate of profit in your business. The most recently acknowledged statement of profit or loss comes into play in this matter. Additional liabilities relating to financial information of close family members and existing loans are thoroughly scanned by bank loan officers before passing your application.
The amount to be lent out to you will also be regulated according to the loans you already might be servicing. Full disclosure of your credit score, the values of your already existing loans will be needed at the time of applying for a bank loan. However, for online loans from individual lenders, the stipulations of the disclosure are far more relaxed.
