Apply For Installment Loans Online – Bad Credit Considered

Installment loans allow you to spread repayment over 1 to 60 months and provide a more flexible alternative to payday loans. See if you qualify for $1,000, $2,000 or $5,000 using our online application form from Capital Bean. We have a number of options available for people with bad credit scores too.


An installment loan is a type of loan you pay back in set monthly amounts, or “installments”. Many people use them, even if they don’t have the best credit. Even with a low credit score, you can still get installment loans.

These loans are pretty popular. For example, about 27.5% of American adults had at least one installment loan during the third part of 2020, as stated by the Federal Reserve Bank of New York.¹ Instead of paying everything back immediately, you make planned payments over time. There are also many installment loans available online.

There are various types of online installment loans, each with different interest rates and conditions. These loans can be for businesses or for personal use. But in this discussion, we’re focusing on personal installment loans. So, if you’re thinking about getting a car loan, house loan, home equity loan, or online loan, it’s good to understand how these loans work.

Types Of Installment Loans

There are several kinds of installment loans, including:

  • Personal loans
  • Car loans
  • Home loans (Mortgages)
  • Loans for school (Student Loans)
  • Loans based on home value (Home equity loans)
  • Loans to combine debts (Debt consolidation loans)

Each loan has a different use, and the rules, conditions, and needs for getting one can change. For instance, people with good credit might get approved more easily, borrow more money, or pay less interest than those with not-so-good credit.

A personal loan where you get the money all at once and then pay it back in set monthly amounts is called an installment loan. This is true for both online and face-to-face loans.

Some installment loans are made for people with not-so-good credit. These are sometimes called “bad credit loans.” They might be a better choice than payday or title loans. You can find these loans both on the internet and in stores. Always carefully check out an online loan just as you would with one you get in person.

Benefits of Online Installment Loans

  1. Consistent rates: You know the interest rates upfront, so no surprises.
  2. Easy-to-plan payments: It’s simpler to set money aside for monthly payments.
  3. Boosts credit: Paying on time can help fix bad credit.
  4. Useful for big buys or combining debt: You can use the loan for many things, including putting all your debts into one.
  5. Better borrowing costs: These loans can be cheaper than other short-term loans.
  6. Yes to those with not-so-great credit: Some lenders focus on whether you can pay back, not just your past credit mistakes. Some even specialize in helping those with bad credit.

Disadvantages Of Online Installment Loans

  1. Risk of repossession: If you don’t pay a secured loan, they might take what you used as security.
  2. Long-term financial commitment: You’ll be paying back the loan for a long period.
  3. Extra charges: If you pay early or miss a payment, you might be charged more.
  4. Costs more for those with bad credit: If you have a low credit score, you might be charged more interest or not get approved.

Choosing an Online Installment Loan Provider

When searching for the right online installment loan, it’s crucial to check out several lenders to get the best deal, especially if your credit isn’t perfect. Many places offer installment loans, including banks, credit unions, online-only lenders, and some online peer-to-peer platforms.

When looking at different online lenders, think about the Annual Percentage Rate (APR), how long the loan lasts, how you pay it back, and how helpful they are to their customers. Finding a lender with a fair interest rate and terms that work for you is good. Also, see if they let you set up automatic payments, so you don’t forget and end up with extra fees. And remember to ask about any costs tied to how you pay, whether that’s online with a card or bank account, in cash, or by check.

By carefully checking out different lenders and finding the right loan for you, you can get the money you need and pay it back without too much stress.

Types Of Installment Loans

Loan Category Interest Rate Type Duration of Repayment Borrowing Range Security Needed Common Uses
General Installment Loan Fixed Depends on terms $100 – $100,000+ Possible Multiple needs
Unsecured Loan Fixed or Changes 1 – 7 years $1,000 – $50,000+ None Consolidating debt, general expenses
Car Financing Fixed or Changes 1 – 7 years $5,000 – $100,000+ Car Buying a car
Home Loan Fixed or Changes 15 – 30 years $50,000 – $1M+ House Buying a house
Short-Term Cash Loan Very high, fixed 2 – 4 weeks $100 – $1,000 None Quick cash needs

10 Steps to Secure a Personal Installment Loan Online

  1. Evaluate Your Financial Health: Check your credit report from leading credit bureaus. If your credit is notably poor, consider working on boosting your score before seeking a loan.
  2. Determine Your Borrowing Needs: Decide on the amount you require and evaluate what monthly repayments you can manage.
  3. Research Loan Options: Investigate various online installment loan alternatives, comparing lenders, interest rates, and loan conditions.
  4. Prepare Essential Documents: Assemble required paperwork such as evidence of earnings, employment verification, and proof of residence.
  5. Apply for the Loan: Fill out the online application form or visit a lender if applying in person.
  6. Await Approval: Lenders will scrutinize your application, possibly including a credit inquiry.
  7. Understand the Offer: Thoroughly read and understand the loan’s terms and provisions before committing.
  8. Finalize the Agreement: Affix your signature on the loan contract and provide any extra details if requested.
  9. Access Your Funds: Upon approval, the loan amount will be deposited into your designated bank account.
  10. Stay Committed to Repayments: Ensure you make consistent monthly payments as per the outlined timeline. Negligence can adversely affect your credit rating.

Typical Charges and Fees for Personal Loans

  1. Origination Fees:
    • Imposed by certain lenders to account for the cost of evaluating and sanctioning the loan.
    • Can either be a flat fee or calculated as a percentage of the loan sum.
    • The exact fee might fluctuate based on the lender and the creditworthiness of the applicant.
  2. Late Payment Penalties:
    • Fees that may be incurred if a borrower fails to make a timely payment.
    • It’s crucial to scrutinize the loan contract to understand potential late charges.
  3. Additional Charges:
    • Prepayment fees might be applied if the loan is paid off early.
    • Insufficient fund charges can be levied if a payment doesn’t go through.
    • Some lenders might impose costs for altering the loan terms, delaying payments, or refinancing the loan.
  4. Mandatory Disclosure:
    • Lenders are obligated to present all fees and charges transparently.
    • If there’s any ambiguity or if you’re uncertain about specific fees, don’t hesitate to engage in a dialogue with your lender.

What Alternatives Are There To Installment Loans?

Credit Options

Consider credit cards or lines of credit as potential substitutes for personal installment loans.

Whether you’re opting for a loan or any other credit line, always inspect the terms to ensure you’re receiving a favorable deal.

Personal Networks

Borrowing from trusted friends or family can sometimes offer more lenient terms and flexibility.

Property-based Lending

Home equity loans or credit lines allow you to borrow against the equity in your home, often at more favorable rates.

Government Initiatives

Investigate government-supported loan programs tailored to particular requirements, like furthering education or renovating homes.

Comparing Instant Payday Loan vs. Installment Loans

Loan Aspects Online Installment Loans Payday Loans
Repayment ✓ Regular, fixed scheduled payments X Single payment due, typically by next payday
Interest Rates ✓ Generally have stable rates X Tend to have elevated rates and additional charges
Repayment Terms ✓ Extended terms, from months to years with fixed payments X Primarily for short-term cash deficits
Loan Amounts ✓ Often allow for larger borrowing amounts X Usually limited to smaller sums
Purpose ✓ Suitable for various expenditures or debt amalgamation X Meant for urgent financial requirements
Approval Criteria ✓ Approvals may accommodate subpar credit based on repayment ability X Often accessible to those with bad credit
Financial Risk ✓ Possible charges for early payback or missed payments; rates might increase for those with bad credit X Risk of spiraling into debt; high overall financial peril
Credit Building ✓ Can enhance credit if managed responsibly X Usually, doesn't contribute to credit records
Competitive Interest Rates ✓ More favorable compared to other short-term options X Generally high rates compared to other credit products
Risk of Repossession ✓ Possible for secured loans X Collateral not typically required
Financial Commitment ✓ Commitment spans a longer duration X Primarily a short-term financial obligation

FAQs About Online Installment Loans

What Is An Installment Loan?

Installment loans refer to any loan which is repaid in regular installments. This can include personal, auto, mortgage, and student, commercial, and commercial loans.

An installment loan refers to any personal or commercial loan repaid in regularly scheduled payments or installments. Each repayment will comprise a proportion of the principal amount borrowed and payment of interest on the debt.

The amount paid back will depend on the total amount of the loan, the interest rate, and the duration of the loan term. Typically, the payment will be the same amount each month.

What Types Of Installment Loans Are There?

Generally speaking, any type of loan that is paid off in regular monthly payments can be considered to be an installment loan. This includes mortgage loans, personal loans, auto loans and student loans. The majority of installment loans tend to be fixed-rate loans meaning that the interest rate is the same throughout the duration of the loan term and borrowers pay back equal amounts in each installment. Mortgage loans are the only exception as they are sometimes a variable-rate loan where the interest rate fluctuates during the loan term.

Are Installment Loans Secured Or Unsecured?

Installment loans can be secured or unsecured. Secured means the borrower has to put up collateral, whereas unsecured loans are non-collateralized. For example, mortgage loans are collateralized with the property being purchased acting as the collateral. Similarly, for auto loans, the purchased car will act as collateral.

However, some installment loans can be given without the need for collateral. Personal loans that are not collateralized are usually assessed by looking at the borrower’s creditworthiness and ability to repay the loan. For these types of loans, a lender will typically look at the borrower’s credit score and credit history, their income and their assets.

As a general rule, the interest rates for unsecured loans tend to be higher because the loan extension is riskier for the loan provider.

How Can You Apply For An Installment Loan?

To apply for an installment loan, a borrower must fill out an application with the lender. Usually, at this stage they will need to specify what the loan is for. Lenders will discuss different available options with the borrower regarding the duration of the loan, the deposit value, the payment schedule and how much each payment will be. Additionally, the lender will typically review the borrower’s creditworthiness to determine the loan terms and what amount of credit they are willing to offer.

The loan term is finished when the borrower has made all the required payments. Sometimes, borrowers can repay the loan before the end of the loan term and save money on interest charges.

Should I Take Out An Installment Loan?

There are many advantages to taking out an installment loan. Borrowers who have installment loans can benefit from their flexibility; installment loans can be tailored to suit the borrower’s specific needs regarding duration of the loan term and the loan amount to ensure that the borrower is able to meet repayments.

Additionally, Installment loans offer a far lower interest rate than some other forms of credit such as credit cards.

Paying off the same value each month means that installment loans are easy to incorporate into budgets and allow for long-term financial planning. Also, they enable borrowers to finance big purchases without making a huge layout of cash.

However, the loan fees associated with installment loans can sometimes be high. If taking out an installment loan on a long-term basis, it is possible that the fixed-interest loan agreed at the start of the loan term may be higher than the market rate at a later stage.

Even though affordability of the loan is assessed at the start, if any payments are not met this could cause long-term damage to the borrower’s credit rating reducing their borrowing power for the future. Because the borrower is locked into this financial obligation, if circumstances change they also risk default and possible repossession of any collateral.

How Do Installment Loans Affect Your Credit?

Applying for installment loans will typically require a credit check. Although this may incur a small reduction in your credit score during the credit check, if you are able to make consistent timely payments, installment loans can hugely strengthen your credit.

Payment history represents a large proportion of your credit score meaning that if you are able to regularly repay your installment loans on the specified date, this will benefit your credit rating.

However, if you are unable to meet your monthly repayments for any reason, the consequences can be serious. Payments made more than 30 days late have the potential to reduce your credit score by 50 to 100 points. Usually, lenders will have the option to set up automatic payments; this can save the hassle of remembering when to pay.

Can You Get Installment Loans If You Have Bad Credit?

It is still possible to take out an installment loan with bad credit (below 630) in some cases. There are particular lenders who specialise in borrowers with bad credit. These lenders will have different lending criteria and will check other variables instead of credit rating. Typically, bad credit lenders may look at factors such as bank account transactions, employment history and existing debts.

Generally speaking, banks will not be able to extend personal installment loans for individuals with bad credit. However, credit unions and online lenders will have lots of options available for bad-credit borrowers.

What Are The Risks Of Taking Out An Installment Loan?

Bad-credit borrowers could be at risk of predatory lending when looking to take out an installment loan. Some lenders take advantage of these borrower profiles and charge extremely high interest rates. Lenders need to disclose the loans APR up front, some of which are 100% or higher; personal finance experts typically recommend that any APR higher than 36% is unaffordable.

If a lender offers no-credit-check loans and does not assess your ability to repay the loan, although this may benefit borrowers who are finding it difficult to secure a loan, it could cause them debt in the future and they are at risk of predatory lending.

What If I Can't Make A Repayment One Month?

If for whatever reason you cannot make a loan installment one month you might be charged a penalty or late fee for this. There’s also the danger that if you miss payments your credit score could be damaged. This is why it’s always important to make sure you can afford the repayments on any loan that you take out. It’s also important to let the lender know if you think you’re going to miss a repayment.

If you let the lender know that you might miss a repayment they might be able to work something out with you.

How Can I Get Instant Approval For A Installment Loan?

Typically, a solid financial history, a good credit score, and a bank account in good condition are the prerequisites for eligibility. For certain personal loans, lenders might mandate collateral. Such a personal loan is termed a secured loan. Individuals with a lower credit score might need to explore multiple options before securing loan approval.

What Factors Influence Installment Loans Interest Rates?

Rates are typically influenced by elements such as the borrower’s credit background, the loan sum, and the repayment duration. Generally, those with stellar credit can secure lower interest rates on personal loans, whereas individuals with compromised credit might be subject to higher rates.

Can I Pay Off My Loan Early?

Certain installment loans offering monthly repayments permit borrowers to make extra payments or settle the loan ahead of schedule without incurring penalties. However, some might impose charges for early repayment. It’s crucial to understand the prepayment conditions of your individual loan.

What Happens If I Default On My Loan?

Failure to meet loan obligations could lead to legal proceedings, accrual of extra fees and interest, and a drop in your credit rating. Neglecting payments or defaulting on your loan may tarnish your credit record for as long as seven years. Hence, if you encounter financial challenges, it’s crucial to discuss with your lender to consider possible remedies or alternate payment plans.

Is There A Difference Compared To Instant Online Installment Loans?

Whether acquired online or in-person, installment loans function similarly. You’ll have to go through the application process, gain approval, receive the funds, and adhere to the repayment plan. The primary distinction is the convenience that online installment loans offer. If you’re leaning towards online options, ensure you exercise the same due diligence as you would with a traditional loan.

Required Documentation FAQs

What Documents Do I Need For Approval?

Lenders generally ask for specific documents to verify a borrower’s eligibility. Commonly requested documents include evidence of earnings, proof of identity, a recent address verification, bank account summaries, and details about one’s employment. However, the exact requirements can differ from one lender to another.

Will Having Bad Credit Impact The Documentation Required For Approval?

Yes, if you have a bad credit score you might be asked for more documents and evidence of monthly or weekly earnings.

Can I Apply For An Installment Loan Without A Bank Account?

It depends who you borrow money from but in most cases the lender will need a bank account to send the money to.

How Can I Send The Lender The Required Documents?

Most lenders will let you send in your documents through email, fax or even the mail.

Once I've Applied How Long Does It Take To Get The Loan?

The time it takes to get approved can differ based on the lender and the applicant’s specific situation, but a decision is usually reached within several business days.

Will I Be Contacted If They Need More Documents?

Yes – if more documents are required, the lender will typically reach out to you via phone, email, or their online portal.

What If I Am Self-Employed Or Have Irregular Income?

To confirm your earnings, you might be asked to submit extra papers like tax declarations or profit and loss accounts.

Can I Use Electronic Copies Of My Documents, Or Do I Need To Provide Physical Copies For Approval?

Most lenders are okay with online copies of papers, but always ask to make sure.

Will the Lender Protect and Keep My Personal Details Private?

Yes, trustworthy lenders follow privacy rules and work hard to keep your data safe.

How Can I Apply For An Installment Loan?

Step 1 
Apply Online

Use our 100% free online form to apply in less than 5 minutes.

Step 2 
Instant Decision

You will receive an instant decision on screen from one of our lending partners who will offer the best rates.

Step 3
Receive Money

You have already provided your bank account details so within 1 hour, the same day or the next business day you will get your funds.

Recognizing and Avoiding Predatory Lending Practices

Instant installment loans can be beneficial for managing finances, but it’s crucial to stay alert to possible scams or shady lending practices. Some dishonest lenders might exploit borrowers, especially those in tight spots, by pressuring them into quick decisions, demanding unusually high fees, or not being transparent about loan conditions. These types of lenders typically target individuals with poor credit because they know they might be desperate for loan options.

Below are some red flags and guidance to help you steer clear of these potentially harmful practices when considering installment loans:

  • Pushy Sales Tactics: Watch out for lenders pushing you to decide quickly or making the process seem rushed. Trustworthy lenders allow you to take your time to look over the loan details without pressure.
  • Sky-High Fees and Rates: Some lenders might ask for very high fees and rates, making it super tough to pay the loan back. Always check out the rates of different lenders before picking one. You should know the total amount you’d pay, including all fees, during the loan’s life. And don’t forget, it might be hard to fix bad credit if you have many loans at once.
  • Confusing Loan Details: Good lenders explain everything clearly. They’ll tell you about the interest, fees, when you need to pay, and what happens if you pay late or can’t pay at all. Be careful if a lender doesn’t share these details or makes it confusing. That’s not a good sign.
  • Loans Without Credit Checks or Promises of Sure Approval: If a lender says they won’t check your credit or promises you’ll definitely get the loan, be careful. Even if it sounds good, especially if you have bad credit, it can be a trick. Real lenders usually look at your credit a bit to see if you can pay back the loan.
  • Paying Before Getting Your Loan: Some tricky people might ask you to pay them before you get your loan. Real lenders don’t do this. They check everything first and then talk about money.
  • Websites That Don’t Look Right or Aren’t Safe: Check the lender’s website. If it looks weird or doesn’t have a lock icon or “https” in the address, be careful. Good online lenders will have a nice-looking website and will keep your information safe.

Always look into the lender first to stay safe from tricks or bad deals. Make sure you understand everything before saying yes to a loan. If you have bad credit, take extra care. A loan should make things easier for you, not harder.

Resources and Assistance for Struggling Borrowers

If you’re having a hard time with your loans, there are some groups that can help you get on track. These groups can give you advice, teach you about money, or even help you make a plan to pay off your debts. If you have bad credit, these places can be really helpful. Here are some you can reach out to:

  • National Foundation for Credit Counseling (NFCC): This is a place that helps people learn about money and debt. They can help you make a budget and manage your money better. You can visit their website at or call them at 1-800-388-2227.
  • Financial Counseling Association of America (FCAA): This is another place that can help you with money advice. They can also teach you about managing debt. You can find more information on their website at
  • Consumer Financial Protection Bureau (CFPB): This is a government group that gives out information and tools to help people make good decisions with their money. You can find out more on their website:
  • State and Local Government Help: Some places in your state or city might have special programs or help for people who are having a hard time with their debts. You can look on your state or city’s website or give them a call to find out.
  • Credit Unions and Small Banks: Some local banks or credit unions might help you learn about money or manage your debts. It’s a good idea to check with your bank or a nearby credit union to see if they can help.
  • Help from Work (EAPs): Some jobs have programs to help their workers with money problems. Ask at your job to see if they have an Employee Assistance Program and how you can get help from it.

Notes From The Editorial Team

As a responsible lender, we’d like to offer advice if you consider getting a personal or online loan. It’s super important to look at your money situation and what you really need before saying yes to any loan, including installment or payday loans. Always ensure you know all the costs and rules of the loan, whether you’re doing it online or face-to-face.

Installment loans can be a smart choice if you’re looking for online loans with monthly payments. These loans have a clear payment schedule and the interest rates don’t change. They can help you plan for big costs and can make it simpler to bring all your debts together. But, it’s really important to pick a good lender. You want one that offers good rates, payment choices, and clear information about all the loan’s details.

Always remember: borrow wisely and pay on time. Doing these things can help you take control of your money. Plus, it can make it easier for you to get loans with good terms later on.



  1. Household Debt and Credit Report |
  2. What’s the Difference Between a Payday Loan and An Installment Loan? | CFPB
  3. Installment Loans | Federal Trade Commission

Capital Bean is a place you can trust for good money advice. We’ve helped many people with their money needs in the past. At Capital Bean, our main goal is to help you understand and grow your money. Whether you’re curious about how to save, use credit cards, or get personal loans, we’re here to guide you.