What is the Difference Between and Installment Loan and a Pay Day Loan?

First of all a pay day loan is an instant cash loan that allows you to borrow cash against your future paycheck over a short period of time. Instant cash loans are the perfect tool to prevent a financial disaster by allowing you to avoid overdraft fees, late charges and penalties that greedy banks and credit card companies love to charge.

Typically, all you have to do to obtain your instant cash loan is you fill out an online application form, or you may have to fax a completed application, that ask some simple questions. Once the documents are received and reviewed the loan is then direct-deposited into your checking account

An installment loan on the other hand is something completely different. An installment loan is very different from a pay day loan. With an installment loan the loan made is repaid over a set period of time requiring a fixed number of scheduled payments. The period of time over which you make payments for an installment loan can range from as little as a few months to as long as thirty years or more; think home mortgage. A home mortgage is your typical installment loan that most people are familiar with.

Unlike an installment loan a pay day loan is for a very short period of time, usually two weeks or thirty days if you are paid monthly. Also, a pay day loan only requires one payment for the full amount of the loan on the predetermined date established when you applied for the loan.

Installment loans payments can also vary between the time of the application and the time that you pay off the loan. This occurs most often when the lending company wants to capture or reclaim and remaining interest due. Depending on when the installment loan payments are to start this may also happen. For example, let’s say you decide to buy a car with an installment loan. The lending company’s policy is to collect payment on either the 1^st or the 15^th of each month. But you borrow the money on the 25^th of the month. In that case your first payment on the installment loan is going to only be for the first 5 days. The next payment will be for the full 30 days.

As you can see installment loans are complex and often times confusing. Not to mention the fact that they can be very difficult to qualify for, require extensive paper work and require credit checks. Also, installment loans usually require some sort of collateral against the loan and are normally not issued for small amounts.

So if you need cash right away and the amount you need is under $1,500 and you don’t want to go through the nightmare of applying for an installment loan then a pay day loan might be the perfect solution to your given emergency.

To find out how easy and fast you can get money now just click on the link above or click here: installment loan