In general, any loan that takes more than three years to pay back is considered a long-term loan. Repayment terms usually last up to thirty years, depending on the lender. Naturally, there are different kinds of loans you can get under this category.
As the name shows, people usually take this kind of loan to pay for the down payment and the monthly payments for their homes.
If you're buying a home, some banks and mortgage lenders require you to put down at least 20% of the cost of the property as a down payment. However, this rule does not apply to all lenders. The deal you get essentially depends on your credit score and pre-approval terms.
Personal loans can be used to cover a wider category of expenses. Any personal expense you have can arguably justify taking out this loan, whether it's to catch up with other immediate debts or simply to go on a trip.
Though these are usually offered with shorter terms than other options in this list, you can still settle on repayment terms that last up to five years.
Installment loans actually fall under personal loans but are what you get if you're really strapped for cash or have an emergency expense. If you're looking for a small loan with fast approval, you can try to apply for an installment loan and pay it back in increments.
This type of loan is mainly used to fund a college education. Student loans can be used to pay for other educational expenses aside from tuition as well, including dorm fees, food allowance, school fees, supplies necessary for study, and books.
Student-borrowers are usually given time to find a job after they graduate before they are required to start paying back their loans.
Loans for automobiles can be taken for any type of car, whether it's used or brand new. Because vehicles are a major asset, this is also one of the loans you'll find that can provide longer terms.
The length of the term you can get financing for depends on your credit score and the age of the vehicle. You will commonly find 84-month loans to be the longest variation for this.
Payday loans are actually more known as short-term loans that can be used to cover urgent necessities like rent or utilities. The catch is you'll have to pay the loan back within a pretty short period of time.
That said, you can actually find some lenders that provide such loans with longer terms as long as you pay it back whenever you receive income from work. The only downside to this is that it will come with much higher interest rates.
Because of the high expenses that come with starting or operating a business, this loan also provides a high amount and longer repayment options. Of course, business loans have stricter criteria. Repayment for this loan does, however, count as a tax benefit.
Getting the Right Loan
The right type of loan can get you exactly what you need. It's simply about doing your research and getting your requirements in order.
First Finance Company Birmingham provides easy installment loans in Birmingham, AL. Let us give you the financial help you need—contact us today.