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Should I get a 6-month personal loan?
Boost your budget and avoid the quick turnaround of other short-term loans.
Six-month personal loans are a good option for those who don’t have the credit to qualify for longer loan terms but still don’t want to risk the quick turnaround of a payday loan. Although you’ll still have to pay higher interest rates than with banks, you may be able to find a six-month personal loan with a competitive interest rate and low fees that make borrowing for an emergency or big project a breeze.
Consider an alternative if you’re unemployed
You need to have a regular source of income to qualify for a six-month loan. And if you’re not sure you’ll have a steady source of income for the next six months, you risk defaulting on the loan and hurting your credit. If you’re unemployed or worried you might lose your job, consider one of these short-term loan alternatives instead.
How does a 6-month personal loan work?
Six-month personal loans are designed to help you with your finances when you need money quickly but know you won’t be able to pay back your loan within a few short weeks. Many offer larger loan amounts as well, making them a good choice for those who need to make a big purchase or pay a hefty bill.
When you borrow a personal loan for six or more months, you’ll pay back your principal and interest in regular installments, with due dates usually set at once or twice a month. However, because many six-month personal loans are meant for people with poor credit, you’ll likely have to pay a high interest rate — sometimes well over 300%.
The exact amount you can borrow and the fees you’re required to pay will vary by your lender and your state. You can browse your options on the table below to see what rates you might qualify for.
Find an installment loan
These lenders and connection services offer loans you can pay off in six months without penalty — even those that offer terms that are longer than six months. Select your credit score range and state to compare your options.
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How do I compare options?
- Interest rate. When looking for a six-month personal loan, rates will vary based on whether you choose a personal loan, installment loan or short term loan. Shopping around is the best way to ensure you end up with a loan with competitive rates.
- Repayment terms. Another thing you should consider when applying for a six-month personal loan is whether it offers a payment plan that suits you. The monthly payments shouldn’t be more than you can afford, and many lenders often schedule them on your paydays to ensure you have the money to make a payment.
- Approval period. Turnaround time will vary, so the faster the approval process the better. Unlike bank loan applications, which are in-depth and often time consuming, six-month personal loans tend to have quicker turnaround, with some lenders able to approve you within a few days.
- Fees and other charges. Some short-term loans carry hefty penalties for missed payments, which could end up straining your finances more and raising the cost of borrowing in the future.
Must read: Always compare your options
Remember, it’s important to compare multiple lenders to see which might offer you the best deal in terms of interest and fees. Using a combination of lender reviews, comparison tables and your own research can help you make the best decision for your financial situation.
What are the benefits?
- Quick approval. Lenders offering six-month personal loans know that you need cash in a hurry, which is why they make the application and approval process much quicker than banks. You can apply for a six-month personal loan online and get approved in a day or two.
- Flexible loan amount. Different lenders offer different loan amounts, but you can generally borrow anywhere from $300 to $5,000.
- Flexible terms. Most six-month installment loans offer you a flexible repayment period and payment options that suit your finances. You usually have the option to make weekly, biweekly or monthly payments to suit your budget.
What should I watch out for?
- Higher fees and rates. Six-month personal loans are meant for short-term financing. This makes them more expensive than standard loans. Don’t be surprised if your loan has an APR with three digits, especially if your state doesn’t regulate the industry.
- Avoid overspending. It may be tempting to borrow more than you need with short-term loans, but keep in mind that the interest rate and other fees make these loans quite expensive. Borrowing more now might mean you can’t pay it back later.
- Missing payments. Make sure that you can comfortably make your monthly payments before you apply for a loan as there are usually steep penalties for late payments.
How do I know if I’m eligible?
Every lender has different eligibility requirements, but these are the basic criteria you’ll need to meet in order to qualify:
- Be at least 18 years old
- Be a US citizen or a permanent resident
- Have a regular source of income
What type of loan are you looking for?
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Are payday loans available in my state?
Bottom line
Six-month personal loans can be exactly what your budget needs, but be careful: They tend to carry much higher interest rates than loans with longer terms. Calculate a budget and read our guide to installment loans before committing to a lender. It could help you avoid late fees and default down the road.
Frequently asked questions
How can I tell if a short-term lender is legit?
Looking for online reviews from independent sources is one way to try and figure out if a lender is legit. A highly visible privacy policy, security policy and contact information are also good signs. At the end of the day, always err on the side of caution: It’s better to go with a well-reviewed lender offering slightly higher rates than one no one’s ever heard of.
Can I pay off my loan immediately?
Depending on the lender, you may be able to. However, some lenders charge prepayment fees or penalties. Ask your lender its policy before you send in a check. After all, your loan payoff amount may not be the same as the remaining loan balance.
How do I get a six-month loan today?
There is no guarantee you will be approved for a loan. Your best chance is to research a lender that has a local branch and that suits your needs. If you go in early enough in the day, you may be able to get your funds before you walk out.
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Ask an Expert
what is the exact charges for each amount borrowed
Hi Domili,
Thanks for getting in touch! You will see the exact charges of the loan based on what you borrow and this will be computed by the bank during the application process. Hope this was helpful. Don’t hesitate to message us back if you have more questions.
Best,
Nikki
I am currently in debt reduction program. I do not own my car my bank has it. Is there a way I can borrow money I need overall to pay everything off in one payment?
Hi Tonya,
Thank you for getting in touch with Finder.
Yes, there are ways to manage your debts and improve your financial status even if you are in a debt reduction program.
For now, I suggest that you speak to professionals for some good advice in managing your debts. You can seek help from financial experts for free.
I hope this helps.
Have a great day!
Cheers,
Jeni