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Loans in Illinois (IL)

Payday Loans and Installment Loans Illinois: Which One Should You Choose?

There are so many types of loans to choose from. And while diversity can be a good thing, it can be a tad overwhelming, especially if your comprehension and knowledge of the financial market is pretty limited. If you’ve reached this article, you might have a range of questions concerning payday loans and installment loans in Illinois and the differences between them. We plan on covering just that!

Payday Loans Illinois

Payday Loans and Installment Loans Illinois: The Differences

While Illinois payday loans and installment loans are often interchangeable terms, they are suitable for different applications and are entirely different. Depending on your circumstances, one type of loan might be more suitable than the other. Let’s see!

Are payday loans legal in Illinois?

Illinois law does provide payday loan consumers with some protections against the cycle of debt. For example, a lender cannot roll over your loan if doing so would keep you in debt for longer than six months. Also, a payday installment loan's monthly payments can be no more than 22.5% of your gross monthly income The maximum you can borrow is $1000.

Introducing Payday Loans

For starters, a payday loan is a short-term type of loan – as the name already implies. There are many lenders that specialize in providing this type of loans, which feature a really easy and to-the-point application process. There is no collateral required, and the lender doesn’t check your credit beforehand. This makes this form of financing really time-efficient, making it suitable for emergencies or unexpected costs.

Essentially, in order to get a payday loan, all you have to do is demonstrate that you have a source of income, and you’re halfway there. In less than 24 hours, you can get access to the money you need.

What is more, there are many lenders online that facilitate payday loans; therefore, you can get your financing from the comfort of your own home.

While these are very positive aspects, it’s worth mentioning that the interest rates for bad credit loans are high. In fact, they are among the highest in the loan market. Hence, convenience and quickness do come at a cost. In addition to that, there are many scammers out there that portray themselves as being reliable when, in fact, this is far from the truth.

This is why you should know for sure that the lender you’re dealing with is reputable.

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Introducing Installment Loans

Continuing our discussion on short term loans and installment loans in IL, an installment loan comes with different specifications. For one thing, it is also a short-term form of financing; however, the interest rates aren’t as high as in the case of payday loans.

In fact, the payment has to be made over a significant period, which is predetermined. The loans that belong to this category are car loans or mortgages, among others. The good thing about installment loans is that you can budget your finances, as you know the amount you have to pay on a monthly basis.

Also, the longer terms don’t imminently translate into a financial burden. Plus, getting such a loan is rather fast and easy. Even so, some types of installment loans require security.

So, which one is going to be? Do you find that a payday loan is more suitable for your specific circumstances, or an installment loan? Take the time to analyze the characteristics of each, as this is the only way in which you can make a sensible decision.

Have a question?

Disclaimer

Short-term loans represent a type of emergency borrowing meant to help you with immediate financial issues. They can only become pricey products once you use them for long-term purposes.

 

MicroPaydayLoans.com‘s operator and owner is not a lender, so he isn’t involved in making credit decisions that include lending and making loan offers. This website actually works as a matching service, helping you contact with lenders and third parties. You are not charged any fee for our service. Moreover, you are not forced to initiate contact with any lender or third party or accept any of their offers.

 

The data that is presented on our website regarding short-term loans and the industry is here for information purposes only. We do not uphold a particular lender, and we’re not responsible for a lender’s actions or inactions. Moreover, MicroPaydayLoans.com doesn’t collect or store your data concerning fees and charges associated with the lenders. Basically, we don’t have access to this data in the first place.

 

Not every state approves of short-term loans. Also, not every lender in our network is able to provide loans of up to $1,000. We don’t guarantee that a consumer will get approval for any loan product or lender or will be matched with a lender. If matched, it doesn’t mean he/she will receive the requested short-term loan.

 

In addition, a lender may want to do a credit verification. This takes place to ensure that you have a reliable credit, and to determine the scopes of credit products to offer. Additional verification may be needed, including your driving license number, social security number, national ID or other documents that help with identification. Keep in mind that scopes vary from one lender to another based on various factors. These factors include the terms determined by each lender and credit standing of the applicant.

 

APR Representative

Annual Percentage Rate, or APR, is the loan rate that’s calculated for the annual term. Considering MicroPaydayLoans.com isn’t a lender and doesn’t own information about any detail of short-term loans offered by individual lenders, they can’t estimate the APR. So, the APR provided won’t be the exact one charged by any of the loan products lenders offer.

 

APRs are very different from one lender to another, one state to another and they depend on various factors, including the credit standing of an applicant. There may be additional charges associated with the loan offer. Some of these charges include late payment, late payment reporting, non-payment penalties, and debt collection actions.

 

These actions have nothing to do with our website. Moreover, we do not have any information about actions taken by the lenders. The financial and non-financial charges and actions can be disclosed in a particular agreement in a clean manner.

 

The APR is calculated as the annual charge, and it’s not a financial charge for a short-term loan.

 

Late Payment Implications

If something happens and you won’t be able to repay a loan on time, it is recommended you contact the lender. Once this happens, late payment charges and fees may be applied. Federal and state regulations may vary from one case to another, and they are determined for late payment cases. Information regarding costs and procedures when it comes to late payment should be discussed before signing any related document. So, make sure you review these with your lender, and they will be disclosed in the loan agreement.

 

Non-payment Implications

If you don’t pay a loan or miss the payment, there may be some financial and non-financial penalties. Any financial charges or fees in case of late payments should be disclosed in the loan agreement. Other actions related to non-payment, renewals, for instance, may be implied upon given consent. Renewal terms are going to be disclosed in each loan agreement individually. Keep in mind that renewal may also come with additional fees and charges.

 

Debt collection practices and any similar procedure will possibly be performed. Any action related to these practices is adjusted to the Fair Debt Collection Practices Act regulations. It is also adjusted to other applicable state and federal laws to ensure the consumers’ protection against negative borrowing and unfair lending experiences. Most lenders don’t refer to outside collection agencies. They will rather collect the debt through in-house means.

 

Late payment and non-payment may significantly impact a borrowers’ credit score and decrease it. Lenders may report these bad experiences to credit bureaus, including Transunion, Equifax, and Experian. If this happens, the consequences of late payment or non-payment will stay in a borrower’s credit reports for a certain amount of time.