Installment Loans Alabama

Installment loan is a type of consumer loan wherein the principal amount loaned plus the interest fees are paid off through fixed monthly payments during the length of the loan period.

Most installment loans in Alabama are taken out to purchase a home, car, furniture or any other big-ticket items. An installment loan comprises specified amounts that have to be repaid over a prearranged repayment period. As a rule, a loan amount is from $1,000 to $5,000 and can vary depending on financial regulators and state laws. The maximum installment loan term in Alabama makes 36 months. Most installment loan monthly payments include the entire amount loaned, meaning both the principal and the interest are factored into the monthly amount or it may only contain the interest amount with the principal being paid in a lump sum at the end of the repayment period.

Alabama Installment Loan Lenders

Installment loans Alabama are referred to in the industry as either secured or unsecured loans.

• Unsecured loans are considered riskier for lending institutions, hence are usually only available at higher interest rates. The borrower's credit score is the prime factor for approval of an unsecured loan. Employment status and previous credit payment history are also important elements. Most common examples of unsecured loans are personal loans and student loans.
• Secured loans are those offered by a bank or financial institution using collateral. With a secured loan, the bank or financial institution has the right to seize and even sell the property put up as collateral if there is failure to pay back the loan. The upside to this type of loan, though, is that the interest rate is comparatively lower than those of an unsecured loan. Generally, secured loans are taken out for mortgages, home or auto equity loans.

Loan Repayment

Online installment loans Alabama are considered to be the most popular type of loan, preferred by more borrowers than other loan types because there are certain advantages of installment loans, making them a better choice.

With installment loans, the monthly payment amount is known to the borrower and does not change throughout the duration of the loan. A borrower, who takes out a loan, will have the time necessary to work out a budget for the loan every month and be able to make the best financial decisions.

State:	Regulator:	Maximum Amount:	Minimum Loan Term:	Maximum Loan Term:
Alabama	State Banking Department	$5,000	-	36 month

Even though you decide that an Alabama installment loan is the right loan for your needs, it is still best to weigh all your financial options and choose a credit facility that offers you the best terms that will be comfortable for you.