MoneyMagpie

Jan 23

Five ways to pay off your installment loan faster

Reading Time: 2 mins

The worst part about taking out an installment loan is obviously paying it off. If you happen to have chosen one of the less reputable lenders on the market, you’ll probably have an even worse experience, since some companies like to provide bad loans to people that can’t really afford them. One thing we have in common as borrowers is that we want to have all our payments finalized and be done with the lenders for good.

There are a handful of measures you can take to reduce your interest and the amount of months or even years it’ll take to pay off your loan. When choosing your next lender, always use comparison sites like bestinstallmentloans.com for an impartial view on current loan providers.

 

Round Up Your Payments

Rounding up allows you to contribute more to your loan repayment without adding a strain on your budget. Just a few dollars more each month goes a long way and can shave off a good chunk of time from your loan term. Depending on how much you’re prepared to round up, whether to the nearest dollar, 10 dollars, or 50 dollars, it pays off to round up your payments and will make your term shorter overall.

 

Make Bi-Weekly Payments

Some borrowers, especially those that have just borrowed for the first time, don’t realize that lenders often let you adjust your payments from weekly to bi-monthly. Doing so will cut your interest and loan term in half since you’ll be paying twice as much. If your lender is flexible, you may be able to adjust your payments from monthly to bi-weekly at any point in your loan arrangement.

 

Go Paperless

Going paperless with your loan provider can actually secure some savings. Signing up for auto-payment saves the lender money and in turn, many of them provide discounts on interest and other loans. Using auto-payment is also better for borrowers because it creates a much more efficient experience and prevents any missed or late payments from occurring. Check with your loan provider for discounts on paperless statements and online billing.

 

Source Other Funds

Besides installment loans, selling your stuff is the easiest way of getting cash quickly. If you have any unwanted possessions, like electronics and clothing, you could use the money to contribute to loan repayments instead of splurging it on other items you might be able to do without. Using sites like eBay can help you receive nationwide attention for your stuff and give you a greater chance of selling it. Be sure to have a plan of how much you intend to pay off your loan and how much you want to sell your items for to reach your goal.

 

Make a One-Off Payment 

We can’t all afford to increase our payments to a bi-weekly arrangement and we don’t all have pricey possessions to sell. Sometimes, we do come into money at certain periods in the year, like with a work bonus or a refund from the tax office, that could be used to make a one-off substantial payment. Even if you can’t use it all, making some sort of payment outside your arranged term will reduce your interest and lead to less time paying your loan off.

 

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