Some opportunities to borrow money, such as payday lending alternatives from Blue Trust Loans, are provided by Native American tribes. These installment loans allow borrowers with no credit history or very poor credit to obtain emergency cash through an online application. Instead of requiring the entire principal and interest to be paid by the next payday, the lender offers a payment arrangement including several installments, such as six payments over six months.
Checking Account Requirement
Funds usually are deposited into the borrower’s checking account the day after the application is approved. Generally, these lenders require payments to be made by automatic withdrawal from that same account, although customers may make each payment earlier than the due date with a debit card. People without a checking account may not be eligible for online installment loans.
Paying more than the minimum amount due each month cuts down on the finance charges that are calculated daily. Sending more than the amount due each time is recommended so the borrower can pay off the total as quickly as possible. Interest rates are higher than with loans from banks and credit unions, but people who need the money usually don’t have any other options. The lender charges those rates because the loans are at higher risk of default.
The Possibility of Late Payments
It’s important to learn what the lender’s policies are regarding late payments. People who need an installment loan typically are struggling financially, and there may be a time during the six months when the money is not available on the due date. It may be possible, for example, for the borrower to change the due date online by a few days. Another possibility might be calling customer service and asking for an extension of the date. Policies vary greatly by lenders.
Because finance charges are high, these kinds of loans are inadvisable for uses such as debt consolidation, funding a vacation, or buying something unnecessary. Instead, borrowers tend to apply for installment loans when they have urgent situations like a car that needs repair or a looming electricity shut-off because of an overdue bill.