There are many ways to borrow money and several ways to pay it back again. We use credit cards. We borrow money from friends and family. We set up car loans and mortgages. Rarely do we turn around and pay all of the money back in a single payment. Instead, we break it up over time to make the process easier for the borrower and provide accountability and security for the lender.
Installment loans are one of the most popular ways to borrow because the provide a routine and structured form of repayment. Additionally, installment loans may offer benefits over credit cards or other types of loans because they tend to have more affordable interest rates and fees.
We use installment loans frequently. We buy an appliance and pay it off installments. We borrow money from our family members and pay back a bit every week or every month. The idea of paying things back in installments is simple and easy to work into our everyday financial lives.