Installment Loans are the New Form of Borrowing

For many years consumers have been using short term online borrowing as a means of covering their short term financial requirements. These online loans have been at our disposal for longer than you may think, in fact it is over a decade now and as such many millions of consumers have used the resource at some point or another. Before these loans we were more limited in our ability to borrow a small sum of money and would have traditionally always relied on our bank for supplying a loan; regardless of the size. Were the resources of the bank proved too large for our requirements, we instead would have had the option to apply for a credit card in most cases. Although incredibly useful for many things, credit cards were not traditionally used for short term borrowing given the nature of the resource being one of an open ended credit facility. As such again we were left with limited choices were our short term borrowing needs were concerned. For years there have been high street based lenders who will exchange your goods for a small loan but again, these type of loans were not always suitable for all and involved the requirement to visit the potential lender and perhaps return once again with the required documentation. All in all although there was choice the choices were not able to realistically meet the requirements of small scale and convenient borrowing.

Installment loans of borrowing

When online loans were introduced, also known as payday loans and more recently, instalment loans, they enabled a simple and easy to understand ability to borrow a small sum of money for a short period of time. This was new to consumers given the fact that the majority of lenders operated online and therefore could be applied for within a matter of minutes. The first type of loan offered in this sector was that of the payday loan which allowed consumers to apply online and if approved, would later repay the entire loan on their next employment pay date. For many years the payday loan dominated the online market for borrowing and in doing so served many thousands of consumers. As the years passed though and the needs of consumers changed, it became increasingly clear that installment loans were the way forward for these online loans. Unlike the primary product offering which saw a lump sum repaid within a short period of time, installment loans allowed customers the opportunity to split the cost of their short term borrowing over a pre-agreed period of repayment. For many consumers it is more affordable to make a number of monthly repayments for a short term loan than make a single lump sum repayment. As such installment loans have continued to grow in popularity within this online borrowing sector. There is a great selection of choices to choose from, meaning repayments can be split over any number of months typically. This could mean as little as 2 months for example or as many as 12 in some cases.