There are many reports suggesting that most Americans would face paying an emergency medical bill of just $500. According to a report from the Kaiser Family Foundation about 30% of American adults had problems paying medical bills in the year 2019. The reports are suggestive of a grave situation, which can further escalate for people who have a bad credit score. The reason being there are not many solutions on offer for such people.
However, if you or a close friend of yours is going through a similar problem, you may find relief through online portals. As simple as that, you can apply for an online installment loan for bad credit and curb the stress. Importantly, such online loans, as the name suggests allow you to repay the amount in parts, thus also relieving you from the stress of repaying huge sums in one go.
How exactly do online installment loans for bad credit work?
Unlike traditional loans, bad credit loans follow a separate set of rules. So, when you opt to apply for a loan online, the portal or the network usually share your details with several lenders. However, there’s yet another difference, the way these loans can be availed as compared to a loan from a bank.
Usually, a bank would require you to go through intense checks on your credit history, pending debts, family income, and of course, your credit score. Such critical checks can have an impact on your score as well, and therefore are also known as hard checks. Whereas, an online lender, especially for bad credit score holders, does not necessarily go through the credit score. Instead, they consider other factors to establish your capability to repay the loan amount.
Carrying out these soft credit checks, the lenders will compute and make an offer that they find befitting your capacity to repay. In other words, the amount of money that you can borrow will depend on, not your credit score, but your income, pending loans, and the tenure that you select for installments.
In most likelihood, you can borrow any amount between $100 to $1000.
Installment loans can help you pay emergency bills
Many people often confuse installment loans with medical insurance. It is noteworthy, that they are absolutely different and do not work the same way, under any circumstance. Although, both options are there to help you cover the expenses of a medical emergency, yet they are entirely different.
A medical insurance requires you to make the installments, better known as premiums, upfront. Meaning, the insurers require the benefits to purchase a coverage policy and make regular payments. Additionally, there are several terms and conditions under which an insurance cover may or may not bear the medical expenses. And, even if your insurance policy covers your medical emergency, it is very likely that they won’t be covering all of the expenses. In which case, you shall have to bear certain costs from your pocket. For example, depending upon the insurance cover, you may require to pay for medicines or other consumables that are not included in your policy.
On the contrary, an installment loan does not require any such condition to be fulfilled. In fact, the lender is most likely to not even consider where you spend your loan money. As long as you can assure the lender to timely repay the amount and in full, you’re good to go. So, in case your insurance company denies to cover some expenses, or a minor treatment completely, you can seek an online installment loan.
Some facts about online installment loans
Despite installment loans offered by online lenders being an easy option, many people report being victimized by fraudulent practices. It renders the need for proper knowledge for availing only the appropriate credit.
Here are some facts that shall help you avail of a loan without falling prey to unethical practices.
- First of all, the credit score, although is not necessary for availing a credit online, yet has an impact on the interest rate you may need to pay. Usually, bad credit would require you to avail a loan at a higher interest rate.
- The next thing you should be wary about is ‘no-credit-check online loans’. The phrase is not the complete truth. If a website or a lender tells you that they won’t need to check your credit score, then they are most likely lying to you. After all, they are to risk their money, so they need some sort of assurance before lending you any money.
- Availing an online installment loan can help you improve your credit score. As long as you can keep up with the installments, you can expect your score to improve in steps.
Tip: Although the idea of availing an online installment loan seems very promising, there’s something that you should keep in mind; borrow responsibly.
Tackling a medical emergency and covering the expenses from your own pocket can be distressing. And it may further take a toll on your health in one way or the other. Therefore, you need options that not only help you avail the medical facilities but also benefit from them. After all, the sole purpose is to recover and stay healthy.
Installment loans are there to alleviate your ailments
Be it a minor bruise that you need to get fixed or a major surgery, installment loans are great for quick cash needs. And what emergency situations can be more demanding than medical emergencies? So, helping you cover up minor expenses seeking an online loan is not at all a bad idea. More so, when you know you have a bad credit score, and no traditional banking institute would come for your aid. But you need to remember that you should borrow only as much as you need. And for this reason, most of the financial advisors would suggest you access only a part of the limit that is being offered to you.