Best Installment Loans to Consider in 2023

Installment loans are used by borrowers who want to finance a large purchase, as well as those who need to consolidate debt with better rates and terms. These loans come with fixed interest rates and fixed payments that will never change, and interest rates are competitive. Our team of financial experts reviewed and ranked more than 30 installment loan companies to help you get funded, so read on to learn about our top picks and all they have to offer.

Because personal loans can have a big impact on your finances, it’s important to spend a little time reviewing your options to make sure you’re not overpaying. Also, it’s usually worth comparing your rates across multiple lenders to ensure you’re getting the best deal for your credit history and financial situation.

Our team of financial experts ranked lenders based on our ratings methodology for personal loans and found the best emergency loans on the market. This ratings methodology evaluates lenders based on loan length, APR, repayment terms, user experience, customer service, credit score history, banking and credit union use, and additional features.

Best Installment Loans in 2023 - Full Overview

Read on to learn which of the best installment loans we recommend, plus a general overview of the loans each company offers.

How to Choose the Best Installment Loan?

When you're searching for affordable installment loans, there are an array of factors to consider and compare. Our experts studied the following factors for each of the companies that made our list of online installment lenders.

• Loan features: As you compare the best installment loans, it's important to look at factors such as potential loan amounts and available repayment plans. Look for installment loan providers who will let you borrow the cash you need with a monthly payment you can afford.
• Interest rates and fees: Check individual companies so you can compare the interest rates they offer, as well as any loan fees they charge. Ideally, you'll find an installment loan company that doesn't charge origination fees or hidden fees.
• Application process: The top installment loans online let you apply and get funding from the comfort of your home. However, their funding timelines can vary widely, so make sure you can get funding within a timeline that works for you.
• Qualification process: Find out about installment loan qualification requirements, which can pertain to your credit score, your debt-to-income ratio, your income, and other factors.
• Customer support: Search for companies that offer plenty of ways to contact them if you need customer support, including a phone number, an email address, and online chat.
• Online user reviews: Look for companies that have mostly positive reviews from past users on websites like Trustpilot and the Better Business Bureau (BBB).
• Perks and Bonuses: Check for providers who offer special discounts, such as autopay discounts. Also look for refer-a-friend programs, forbearance plans, and other perks.

Main Features of The Best Installment Loans

What Is an Installment Loan?

Installment loans are unsecured personal loans that let borrowers access a lump sum of cash then pay it back via predictable monthly installments. These loans come with fixed interest rates, fixed monthly payments, and a predetermined repayment schedule that will never change.

How Do Installment Loans Work?

Unlike credit cards that give you a line of credit you can borrow against, installment loans let you access a lump sum of money. After your loan is approved, the loan amount is typically transferred to your bank account electronically. Once you receive the funding, you begin making regular monthly payments for the duration of the loan term.

As we mentioned already, installment loans come with fixed interest rates, fixed monthly payments, and a fixed repayment schedule.

Types of Installment Loans

While personal loans are the most common type of installment loans, there are many types of loans that fall into this category.

• Personal loans are unsecured loans used for debt consolidation, home remodeling projects, and large purchases.
• Student loans let borrowers finance higher education then repay their balances over time.
• Auto loans are secured by a vehicle, and they let people make installment payments toward their balances.
• Mortgage loans let borrowers use equity in their property as collateral. From there, they pay for their property via regular monthly installments.

Reasons to Get an Installment Loan

There are numerous reasons to consider the best installment loans, including the following:

• Debt consolidation: Use an installment loan to consolidate high-interest debts from credit cards and other loans you have.
• Major home remodeling projects: Use your loan proceeds to remodel your kitchen, add another bathroom, or build an outdoor deck or patio.
• Weddings: Finance your dream wedding then pay it off with regular monthly installments.
• Medical bills: Consolidate medical bills and keep debt collectors off your back.
• Auto repairs: Pay for auto repairs you weren't prepared for, such as collision repairs, new brakes, or a new suspension.
• Unexpected expenses: Get cash you can use for any reason, including surprise bills that pop up.
• Splurge purchases: With competitive rates and loan terms, installment loans are a good option if you want to finance a boat, an RV, or a backyard pool.

How to Get an Installment Loan?

Although the process involved in getting an installment loan varies by lender, the same basic moves are required. The following steps can help you get the personal loan you need for a price you can afford.

• Step 1: Decide how much you need to borrow, and use an installment loan calculator to see an estimate of your monthly payments.
• Step 2: Look at our list of online installment lenders to see which ones offer the loan amounts and repayment terms you need.
• Step 3: Check your rate online with at least three lenders, and look for the company with the most affordable installment loans.
• Step 4: Look at loan terms offered to you, and see if one lender stands out from the others in terms of your future installment payment amount, your repayment timeline, and fees required.
• Step 5: Choose a provider for your unsecured installment plan, and move forward with a loan application.
• Step 6: Fill out the installment loan application with your full contact details, Social Security number, employment information, income, and more.
• Step 7: Wait to receive notification that your installment loan application has been approved.
• Step 8: Watch for your loan funds to show up in your bank account.
• Step 9: Begin making installment payments based on the loan terms and repayment plan you agreed to ahead of time.

Where to Get an Installment Loan

Since installment loans are personal loans are one and the same, you can apply for an installment loan with an array of online lenders and brick and mortar institutions.

• Online Lenders: The top installment loans online are easiest to access since you can compare companies and apply from the comfort of your home. Without a brick and mortar location to maintain, online personal loans companies tend to offer the best rate and terms.
• Traditional Bank: Traditional banks also offer installment loans, so make sure to compare them to the loans you can get online. Bank customers who have a long history of working with an institution may be able to qualify for an affordable installment loan with a flexible repayment plan.
• Credit Union: Installment loans are also available through credit unions, and current customers may be able to qualify for preferential rates and terms. Make sure to compare credit union loans to the low interest installment loans you can find online.

Installment Loans vs. Payday Loans

Where installment loans offer an affordable way to borrow money with fixed rates and terms, payday loans tend to be predatory in nature. While payday loans typically only let you borrow up to $500, the Consumer Financial Protection Bureau (CFPB) warns that interest rates can be as high as 400%. With crushing interest rates that make borrowing extremely costly, payday loan customers are often caught in a cycle of debt that's difficult to escape.

Installment Loans vs Revolving Credit

Revolving credit is different from installment loans since you don't get access to a lump sum of cash. Instead, revolving credit offered through products like credit cards gives you access to a line of credit you can borrow against or make charges with. Revolving lines of credit also tend to charge much higher interest rates, and they do not come with a fixed repayment plan you agree to ahead of time. According to Federal Reserve data, the average interest rate on credit cards worked out to 16.17% as of February 2022, whereas the average 24-month installment loan came with a rate of 9.41%.

Conclusion

Installment loan companies provide an affordable way to borrow cash when you need it, whether you have bills to pay off and consolidate or you have a large purchase coming up. If you're after this type of funding, you should take the time to compare the top installment loan companies that made our ranking based on their loan features, their loan fees, and their reviews.