Payday Loans, we’d like to thank you. For a lot of years you were very helpful, making sure working class folks and people with bad credit had access to quick cash in an emergency. These were the good people the banks and credit companies would not help out, and you did. We will always remember your service.
Buuuuut, you’re not needed any more. Sorry guys. As much as we love you, something better has come along and replaced you.
Installment loans take every good aspect of the payday loan and improve upon them. Even more importantly, they take the very worst aspects of the payday loan and get rid of them entirely!
Payday Loans:
Unsecured loan, no collateral required
Installment Loans:
Unsecured loan, no collateral required
Payday Loans:
No waiting, get your cash within hours
Installment Loans:
No waiting, get your cash within hours
Payday Loans:
Interest and fees added each month, with no limit
Installment Loans:
All interest and fees calculated up front, and never increased
Payday Loans:
Open ended repayment schedule that could last months or years
Installment Loans:
A set repayment schedule that does not change unless you request a change
Seems pretty obvious why the old style payday loan is being phased out. With all of the advantages and none of the drawbacks, the installment loan is clearly the wave of the future.
Correction – the wave of the present.
Let’s use the great state of Missouri as a perfect example. In 2005 there were 1335 licensed payday lenders in the state, and combined they issued roughly 3 million loans that year.
Just over a decade later, Missouri has 653 payday lenders within its borders. And they account for roughly 1.6 million loans.
The payday loan business has decreased by half! Did all of these people just get better jobs, or get a nice inheritance from Aunt Hortence?
Of course not. The number of borrowers remained steady, with a slight increase. They just started using installment loans. It was the smarter play for their finances.
In another ten years, payday loans may be a thing of the past entirely. Installment loans are slowly and steadily driving them out of the market. And for darned good reasons!