The First-Time Borrower's Guide To Installment Loan Terminology
As a first-time borrower, it’s important to know the basics of installment loan terminology – and that’s exactly what we’re going to cover here today. Learn all you need through easy-to-understand lingo, as well as the full and clear installment loan definition.
- Installment loan terminology
- How to qualify and apply for an installment loan
- When to get an installments loan
- And more…
Once you breeze through this guide, you’ll have the knowledge you need to decide whether or not this type of loan is right for you.
Installment Loan Terminology
Before we get into loan terminology, let’s find out the installment loan definition. It is a legal agreement where a borrower pays back a lender over a set number of scheduled payments. The number of payments and principal amount will depend on the borrower’s needs and the lender they use. Mortgages and car loans are examples of installment loans.
And now, here is the installment loan terminology you must know when learning about these loans.
Adverse Action Notice
This is a notice to tell someone their loan application was denied. It could be a letter or electronic message.
Automated Clearing House (ACH)
You’ve probably used ACH payments before without knowing it. This is a program for online financial transactions like direct deposits, debits, and credit transfers. If you select an ACH transfer, it means the money will move directly to or from your bank account.
Amortization is the process of gradually paying off something you owe through regular payments. The amortization period is how long the loan is given.
The applicant and the borrower are often synonymous. This is the person who wants to take out the loan.
An asset is any financial resource you own. Assets hold value and make up your net worth. They could be cash, investments, or property.
Direct Lender Vs. Indirect Lender
A direct lender is a loan company, like Nevada Title and Payday Loans, Inc. and an indirect lender is a third party that connects applicants with direct lenders.
When the borrower doesn’t meet an obligation required by their loan, they default on it. Usually, this happens when a payment is missed.
Fixed Rate Vs. Variable Rate
Fixed-rate loans have a set interest rate, whereas variable rates change during the life of the loan.
Interest is a fee, usually described in a percentage, charged to take out a loan. The borrower will pay back the loan amount (principal) plus the interest.
A loan commitment is another word for loan approval used by certain lenders.
Underwriting is when the lender makes sure the borrower meets the qualifications for a loan. This may include checking your credit, analyzing your financial situation, and more.
Some installment loans charge an origination fee, which covers the cost of processing and managing the loan. The borrower has to pay this fee.
Personal loans are short-term loans, usually in smaller amounts and for shorter loan terms. Payday loans and installment loans are types of personal loans.
The principal is the initial amount you borrow. It does not include interest or fees.
When To Get An Installment Loan
Installment loans are great for those with little to no financial resources who need cash fast.
Installment loans from Nevada Title and Payday Loans, Inc. can be used as emergency personal loans for things like urgent home and car repairs, medical bills, and to pay overdue utility bills or rent. They should not be used on trivial purchases.
How To Get An Installment Loan
Now that you’re familiar with installment loans, you may be ready to apply for one yourself. Nevada Title and Payday Loans, Inc. offers a fast and simple way to apply for signature installment loans.
Qualify for one of our loans by checking off the following:
- Hold a valid state I.D.
- Have proof of regular income
- Have a checking account, with checks
- Be 18+
If you meet our qualifications, get started by filling out the form on this website. One of our local representatives will then reach out to you to discuss the loan and your paperwork. You’ll then stop by a local office to present your documents and complete the approval process.
If everything checks out, you could have up to $1,500 in your account within the day.
Take Control Of Your Installment Loan Today
Ok, now you know the installment loan definition and important installment loan terminology. You’re also aware of what you need to qualify and how to apply. The final question is, are signature installment loans for you?
If a few hundred or even $1,000 would be helpful to get you out of an urgent financial predicament, this could be the short-term solution you’ve been searching for. Contact us today through the form on our homepage to learn more and get the signature installment loan process started. A quick call today could mean a more relieved tomorrow.
Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.