4 Tips for Repaying Your Installment Loan on Time
Managing your finances can be tough at the best of times, but even more so when it comes to repaying a loan. If you have secured quick approval loans online, you may be concerned about repaying them on time. Having a budget is a great place to start, along with these four tips to help you maintain your financial health while paying off your loans.
1. Understand the Terms of the Loan
Things to look out for when reviewing the terms of your loan:
- Loan repayment term
- Repayment schedule (amount and frequency)
- Interest rate
- Late payment policies
- Fees and penalties
- Renewal or extension options
Having a good grasp of this information will help you plan ahead for regular payment and avoid any nasty surprises.
2. Set Up Automatic Payments
Setting up automatic payments like standing orders or direct debits can give you peace of mind to know that every payment will be made on time. Consult with your bank or your lender to make the necessary arrangements. You can also ask your lender about discounts on fees or interest rates if you enter into a direct debit agreement with them.
3. Avoid Additional Debt
If you are already paying off debt, be it an online installment loan, credit card or store credit, consider paying it off before taking on new debt. Remember that every cent of debt you have attracts interest, meaning that the longer you are in debt, the more you will pay.
By handling your debts carefully, you can avoid getting into what is called the “debt spiral,” where you end up taking out new loans to pay off your existing ones. The financial hole that you find yourself in just gets deeper.
4. Prioritize Your Repayment
Paying off debt trumps all and should be your top priority. Focusing on debt repayment over luxury and non-essential expenses is vital to maintaining your financial health. Halt payments into your “rainy day” fund and redirect these funds into debt repayments.
Take a long, hard look at your budget and identify any areas where you can make some cuts. During this time, if you receive any bonuses or incentive payments, these should be applied directly to paying off debts.
Once you’ve paid off your debts, you can enjoy guilt-free spending (within your means) because your budget will improve. With the extra cash each month no longer going towards debt repayments, you’ll have more financial flexibility.
Signature Cash offers quick approval installment loans online at competitive rates. Click here to apply for a loan—our Canada-based customer service team is standing by to assist you every step of the way.