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Instalment Loans

Instalment loans are a type of personal loan where you borrow a sum of money and repay it over time. They can be used for any purpose, like home improvements, debt consolidation or financing a new car

An instalment loan can help you borrow money and spread the cost of repayments over one to 30 years. They are offered as either a secured loan, where your assets are presented as a guarantee of payment, or unsecured loan, the terms of which are usually based on your credit score. While instalment loans offer flexibility in their terms, missing repayments can negatively affect your credit rating.
  • Instalment loans are repaid over a set period, usually as a monthly payment

  • They can be taken out as either a secured or unsecured loan

  • They offer more flexibility than payday loans

  • Due to interest, the longer the repayment period is, the more the loan will cost over time

  • If you fail to keep up with the payments, you could harm your credit score

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What is an instalment loan?

An instalment loan is like other personal loans in that it can be paid back over an agreed period. This is usually in the form of a set monthly payment, with interest calculated depending on the length of the repayment period and your own financial circumstances. As a borrower, you can choose to repay your instalment loan between one and 30 years. However, the longer the loan term, the more it will cost overall.

Instalment loans give you flexibility to choose the amount you want to borrow and the length of your repayments. It’s important to keep up with repayments, as falling behind can negatively affect your credit score, making it harder for you to be approved for a favourable loan in the future.

Is an instalment loan right for me?

Instalment loans allow you to spread the cost of your borrowing, which makes paying back your loan more manageable.

However, if you cannot meet the repayments, you could face negatively impacting your credit report and the lender could take you to court. If you have taken out a secured loan, this could also mean losing your home.

Instalment loans for bad credit

A common misconception about instalment loans is that customers with poor credit will always be refused, or that even applying could negatively impact your credit score. So long as you meet the repayment terms each month, taking out an instalment loan could have a healthy effect on your score.

There are lenders for bad credit instalment loans who may be more willing to accept your application, providing you can meet the repayments consistently each month.

By regularly paying back the loan each month as agreed between you and your lender, your credit score may improve over time. This is because the repayments demonstrate that you are a reliable borrower. This can boost your chances of being accepted for other types of credit in the future, even if you’ve been rejected by other lenders previously.

Commonly asked questions

Have questions about long-term instalment loans? Find answers to some of the most common queries below.

Can I pay off a loan early?

It’s always possible to pay off the balance in full at any time when you take out a loan. However, choosing to repay the debt in full may incur an additional fee for Early Repayment.

Can I take a break from paying back my loan?

Some instalment loan lenders in the UK offer ‘payment holidays’, which allow you to take a break from repayments. However, this might have a negative effect on your credit report.

Check the terms before you sign up.

Instalment loan details

With access to over 600 plans, we could help you find a loan to suit your needs. Find out more about taking out an instalment loan with Norton Finance.

How much can I borrow?

Norton Finance can help you borrow anywhere between £3,000 and £500,000.

How long are the repayment terms?

Depending on your financial situation, and what you can comfortably afford to pay back each month, terms last from one to 30 years.

What are the interest rates?

The rate you are offered depends on a variety of factors, including your current credit score and credit history. Secured instalment loan rates for homeowners start at 3.37%.

Are there any loan fees?

We’re a broker – not a bank. We receive a commission from the lender once a loan application is completed and charge a broker fee on secured loans. This can go up to 12.5% of the loan amount, to a maximum of £3,995. We do not charge fees on unsecured loans.

Applying for an instalment loan

Whether you choose to take out an unsecured or secured instalment loan, it’s important to check you can meet the repayments each month.

It’s also a good idea to run through your credit report to identify any errors or concerns which could prevent you from being approved for the loan. Getting an instalment loan if you have bad credit or CCJs is possible, but usually means it’s offered at a higher interest rate.

Am I eligible for a loan?

With access to over 600 loan products, Norton Finance can find the right service for you, no matter your financial situation. Whether you are currently struggling with bad credit or CCJs, or are self-employed or retired, our extensive panel offers a variety of available options.

Whatever your circumstances, we can help you access funds to cover those urgent expenses.

What do I need to apply for an instalment loan?

You can apply for an instalment loan using our easy online application process, just select the amount you’d like to borrow. Afterwards, we’ll get in touch to discuss your details, so try to have the following to hand:

Once we have all the information we need, we can often give you an answer on your eligibility right away.

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