The modern world offers people many amenities, one of them is the purchase of goods, for which you can pay later. All this thanks to services such as credit and installment plan. Today, in many stores, purchasing goods you can issue one of two (credit or installment plans) using all the amenities to the maximum. In this material, a comparative analysis will be carried out, how these two services differ, and also what advantages and disadvantages they have.
Installment and loan features
In order to know exactly what is better to choose, by installments or a loan, you first need to know what their differences are, as well as what functions these services can perform. For example, installments are taken to purchase a certain product, a person will pay in installments only the right amount for the product, without paying the interest rate for using the funds.
If a loan is taken to purchase goods, then here a person will need to pay the interest rate for each day of using the funds. When applying for a loan, a pledge is not necessary, but in the case of installments, a person must provide a pledge in the form of the goods that he purchases. During the payment of goods by installments, a person can use the purchased goods.
Installment loan: advantages and disadvantages
If at the time of purchase, a person cannot decide which lending option to choose: an installment plan or a loan, it is worthwhile to understand that a loan here means a consumer loan, which can be arranged much easier than the target.
Among the benefits of installments can be identified:
- Quick exchange and return of goods, where the borrower will immediately give the full amount;
- Quick registration, where you need to have the very minimum of documents;
- The buyer does not need to pay interest on the use of funds.
Installment has quite a few advantages, but there are also disadvantages:
- When purchasing goods, the client needs to make an initial payment, sometimes up to 70% of the value of the goods;
- Installments can be issued only up to one year, but this period may not be enough to fully pay for the goods;
- Many stores can simply increase the amount of goods, so that customers draw up installments and overpay more money, thinking that they are saving.
Installment has quite a few advantages, but microloans also have many advantages, for example, in the online service you can get a loan in the amount of up to 15,000 dollars in just 15 minutes, having with you the very minimum of documents and pay a very small interest rate. Here you can get a loan at the right time, with the possibility of extension, without any restrictions for the borrower. It is only the buyer who needs to make a choice between credit and installment plans, but knowing their advantages, it is safe to say that these two options really make life easier for a person.