Credit has become the medium that greases the wheels of most people’s lives.  This could be through overdrafts, credit cards, loans or mortgages.  Unfortunately it is also the bane of many people’s lives, when it gets out of hand and becomes unmanageable.  This situation fast becomes a perpetuating cycle of borrowing to pay off borrowing.  This will lead to a bad credit record.   In seems to be a never ending circle of debt.  But there are ways to break the circle and get you back on track through a product called bad credit installment loans.

What Are Bad Credit installment Loans?

“Installment loans are a short term loan to fix a short term financial difficulty”

They are often available without any credit check requirement.  They should be seen only as either an emergency solution for a very temporary problem, or a simple way to try and pay of credit in small chunks to restore a bad credit record.  Bad credit loan payments are ideal for this purpose.

Many borrowers use these bad credit installment loans to smooth over difficulties they may have month to month as they are available with minimum paperwork and in small amounts from £50 upwards.

Most are unsecured loans meaning less risk of losing personal property such as a car or your house.  Unsecured loan installments definitely are the preferred option.  Repayment is then by one simple installment to pay off the whole loan including interest.  Due to this they are often referred to as installment payday cash loans, a terminology from the USA.

Who Is Suited To Bad Credit Loans?

Basically these short term loans are designed for those who have a poor or bad credit record, whatever the cause.  Bad credit installment loans are designed to help people.  Sometimes the credit record is down to the accumulation of debt.  But often it is because the borrower may be in a high risk group, such as the unemployed, students, or home makers.  Generally anyone without a proven and demonstrable income source will be lumped into this category and have to consider bad credit type of installment based loans.

Of course those with defaults and arrears on their records, along with any insolvency notices or proceedings, a history of bankruptcy or with any County Court Judgements registered against them will also fall into this grouping.  Finally there are also some applicants who although fully employed, find themselves running short of finances in a particular month and need a temporary small top up.  What bad credit installment loans do is offer a way out and short term solution to all of these groups, whatever their circumstances.

In this instance you will need to consider the many new payday loan companies that offer short term bad credit installment loans which are easy and simple.  They may not be the most “ideal” solution, but for many people, these kind of loans are a real lifeline.

What Will These Loans Cost?

This is where we get into the territory of the bad credit loan company and interest rates.  Their installment loans for bad credit situations can fall outside the realm of “normality”.  Quite simply put, if APR rates of 2 figures scare you then stay away from these unsecured bad credit installment loans.  Often the interest will hit 3 or even four figures.  Over 30 days, as long as you pay back, then the actual cash amount of the interest on a small advance will not seem too bad.  But if you fail to settle, then you are going to have serious problems.

As an example, I have just had a quick look on a loan comparison site for details on various bad credit installment loans.  The cheapest loan for borrowing £100 is at an interest rate of 1286.2% and would mean a £25 total charge for credit over the 31 days.

When you consider applying to a bad credit loan company for one of their bad credit installment loans, then you really do need to be very wary indeed.  There are many reports of sharp practices and sales techniques when it comes to the selling of certain installment loans, which may confuse a lot of applicants, many of whom are in a desperate situation at the time.  It is highly likely for a start that any one loan company you visit will be paid a large proportion of their pay as commission.  This can cause problems in itself.  Secondly they are not in the habit of clearly and concisely showing the interest rates payable and the true costs of taking the loan and the consequences of defaulting.

If you go online, these techniques are clear to see, many companies offering installment payday cash loans have only 1 or 3 page sites.  There are no interest rates or illustrations shown on the sites.  In fact most of the time the only way to proceed is to hit the ‘Apply’ button

So you must know what you are getting into.  If you go in eyes open knowing this is a one off then you will be fine as you understand the cost and consequences.  However, do not view these bad credit loans as a solution to top up finances and wages regularly to cope.  If you do it will cost you a small fortune as the vicious cycle happens that you borrow more each month to pay off the previous month’s loan.

How Easy Are Bad Credit installment Loans To Apply For?

(Are there really any benefits of bad credit installment loans .. ?)

In fact these bad credit loans are very easy to apply for.  Most of the time the only requirement is to provide proof of pay or some income and that you are a legal UK citizen.  Applications for installment loans can be completed in matters of minutes and the money in your hand or back account soon after that. Often within a couple of hours.

This application process has to be streamlined as this urgent nature is the whole benefit and purpose of these loans.

This is what you pay the high interest charges for, the risk that the loan company is taking.  As long as you realise this clearly, then you know exactly what you are getting into and you should be fine.

That in a nutshell is what these kinds of bad credit loans are about.  They are only an extremely short term solution to temporary financial difficulties.  They are simple to get, but ultimately expensive if you fail to repay on time or use them as an extra source of income.  They are not for everybody and certainly should not be used to fund major purchases such as cars and furniture.  Click here to apply for short term bad credit installment loans.