Lifestyle

5 Key Questions to Ask Before Getting a Personal Installment Loan

So you’re thinking about taking out a personal installment loan. Odds are, you already have plenty of questions running around in your mind. This is perfectly normal, so no need to stress out. After all, the first step to knowledge (and a smooth application process) is curiosity.

At World Finance, we’ve heard plenty of loan-related questions over the years, but here are 5 key ones to ask before applying for a personal installment loan.

WHAT is a personal installment loan?
You have the right to know what you’re getting yourself into. A personal installment loan is a set of borrowed money (typically between $500-$5000) that’s paid back in equal monthly amounts over the life of the loan with accumulating interest. If your credit score isn’t in great shape, a personal installment loan may be a terrific opportunity to build it back up, since lenders like World Finance report payment behavior to credit bureaus. If you’d like to see how a personal installment loan holds up against other options, we wrote an entire blog post that goes into the pros and cons of 3 basic loan types available to borrowers with imperfect or zero credit.

WHY am I taking out this loan?
Okay, time for a reality check. What exactly is this loan for? If it’s to cover unexpected expenses, like medical bills or car repairs, then applying for a personal installment loan might be a good idea. If you’re using this loan to pay off another loan, forget it. This will only put you on the path to accumulating a mountain of interest that’s more trouble than it’s worth.

HOW will I pay this loan back?
To make sure you don’t fall on that destructive path, think about whether your budget can afford to make monthly payments for the entire life of the loan. At World, we work with our customers to find a monthly amount that fits into their budget, factoring in other life expenses like groceries, rent, and utilities.

WHEN will this loan be fully paid off?
Depending on the amount you’ve borrowed, your monthly payment amounts, and your interest, personal installment loans can take anywhere from 4 to 46 months to pay off. Be sure to ask about your particular timeline when you apply or speak with a loan professional.

WHERE should I start?
Congratulations, you’ve already come to the right place! Once you’ve researched enough to feel comfortable about applying for a loan, gather your documents together and head to your nearest World branch. Our associates will guide you through the application process and answer any other loan-related questions you may have.

Now time for a bonus question.

WHO is on their way to a more stable financial future?
Take a look in the nearest mirror.