ISmall-Business.net

Intelligent Business Solutions

  • Home
  • Strategy
    • Small Business Strategy
      • Combining Niches to Maximize Profit Potential
      • High Ticket Versus Volume Niche Selection
      • How to Know When to Cut a Business or Niche Loose
      • Never Put All Your Eggs in One Basket
    • Sales Strategy
      • Facebook Networking Versus Paid Advertising
      • Brainstorming a Successful Sales Funnel
      • Best Practices for Profitable List Building
      • Backend Sales Strategy Tips
      • A Better Way to Use Webinars for Profits
      • Creating a Welcome Email That Makes Money
    • Production Strategy
    • Human resource strategy
  • Management
    • Business action plan
      • 7 Things to Send JVs to Get Them Onboard
      • Don’t Make JV Promises You Can’t Keep
      • How to Host a Challenge and Maximize Profits
    • Small Business Management
      • Putting Profit Tasks First During Time Management
      • How Self Doubt Sabotages Your Financial Success
      • Repurpose Your Content to Save and Make Money
    • Business Management Topics
      • Fighting the Stigma of Failure
      • Figuring Out the Perfect Launch Date and Time
      • Bonus Creation That Catapults You to Leaderboard Domination
      • Do Customers Prefer Video or Text Courses
      • Minimize Your Risk of Refunds with These 5 Tips
      • How Often Should You Email Promo Material
      • Narrow Niche Domination
      • Perfecting the Launch Process for Increased Profits
    • Business Management Blogs
      • Nobody Expects a Perfect Expert
  • Ideas
    • Find business ideas
      • 5 Lucrative Non IM Niches
      • 6 Niches That Are Hot on Social Networks
      • Are PLR Stores a Viable Way to Make Money
      • How to Know If a Membership Site Is Right for You
    • Idea feasibility
      • How to Make Money Off a $7 Product
      • Recurring Income Options
    • 10 top business ideas
      • Could Coaching Bring in More Money Than Products
      • Individual Coaching Versus Group Coaching Profits
      • Building a Reputation as a Powerful Affiliate
      • Pinterest Profit Niches
    • Low cost business ideas
      • Making Money Off eBooks and Reports
  • Valuation
    • Business Valuation
    • Increase business valuation
      • Making Wise Investments in Tools to Further Your Business
    • Business Valuation Methods
    • Understand business valuation
  • About
    • About Me
    • Blog
    • Contact Us
    • Sitemap
    • Privacy Policy
  • Strategy
  • Supply Chain
  • Customer Focus
  • Entrepreneur
  • Biz Opportunities
You are here: Home / Biz Opportunities / How Do Installment Agreements Work? – Running Your Business

How Do Installment Agreements Work? – Running Your Business

August 6, 2019 by Asif Nazeer Leave a Comment


If you search the Internet for a brief description of installment agreements, you might be confused by articles that refer to “installment loans.” In this post, we try to provide some clarity about what, exactly, an installment agreement is.

You might be looking for a cash infusion for your business, or you might need a personal loan. Whatever your need right now, always pay attention to the specifics when you’re requesting a loan of any kind, whether on cashspotusa or any other financial platform.

What Do You Need to Know About Installment Agreements?

The lender issues the funds for an installment agreement under specific guidelines. For example, the lender issues the agreement for a set amount of money at a specific rate of interest. Additionally, the payments are fixed as well.

Compare this with the revolving credit banks and other lenders provide. Revolving credit comes with a set credit limit and a flexible payment amount based on the amount of your credit limit you have used. Revolving credit often comes with a variable interest rate as well. A credit card is an example of revolving credit.

Sometimes a bank or other financial institution will issue the funds for an installment agreement. At other times a merchant issues the funds in order to allow a customer to purchase a specific piece of merchandise.

Installment Agreements Come with a Fixed Interest Rate

These agreements carry a specific and fixed rate of interest. The repayment schedule is also fixed. That is, the lender generally requires payments in a set amount at regular intervals, usually monthly.

Will You Need Collateral?

An installment agreement is generally issued for a clearly defined purpose such as buying a car, a household appliance, or other goods. Therefore, installment agreements often require collateral, such as the merchandise the customer is purchasing. For example, a mortgage is an installment agreement that uses the home that’s being purchased as collateral.

However, some lenders issue installment agreements without collateral. In these cases, the lender might require you to obtain personal recommendations from trustworthy individuals who know you.

Will You Need an Application?

Before you can obtain an installment agreement, you will need to submit an application, either online or in person. Then the merchant or other lender will either approve or reject your application.

Is There a Contract for This Type of Agreement?

In most cases, both buyer and seller sign a contract for an installment agreement. This contract stipulates the conditions for both parties. It covers the interest rate, states its maturity date, and specifies any applicable fines and fees. The contract will also describe the nature of any additional fees that might come due in case the customer fails to repay the agreement as stipulated in the contract.

RELATED ARTICLE: 6 CONTRACT TYPES YOUR BUSINESS NEEDS

Can I Apply Online?

It’s safe to say that you can obtain an installment agreement without the need to leave your home or your business. You simply choose an online lender, complete the application online, and await the approval of your application. Often the lender will approve your application within days, if not hours or even minutes.

On the other hand, if you’re hoping to use an installment agreement to help with the purchase of a piece of merchandise such as a dishwasher or a car, you might want to visit the merchant in order to shop around for exactly the item that best meets your needs.

In that case, it would make sense to simply apply in person. Often the merchant will make the funds available within minutes. Then you can request delivery of the merchandise to your home—or, in the case of a car for example, drive it home with you.

Do These Agreements Come with a High Interest Rate?

Often, lenders issue installment agreements for shorter periods than they do other loans. Additionally, the interest rate is often lower as well. In fact, some installment agreements come with very low or even zero interest. However, these low rates of interest usually remain in effect only within the set term of the contract or another specified period.

What Are the Benefits of Installment Agreements for Buyers?

Installment loans have the following benefits for buyers:

  • Lenders generally require only a small packet of documents.
  • You can register and apply quickly.
  • Much of the time, you won’t need to offer up any collateral.
  • Generally speaking, you will have a choice as to how much time you’ll need to pay off the agreement. Often, the lender will allow you to extend the agreement if you need to.
  • The interest rate for the agreement is quite often very low or even zero.

What Are the Benefits of These Agreements for Sellers?

Installment agreements are popular among many merchants since they allow stores to increase the number of their customers and boost their sales.

On the other hand, these agreements do carry risks for the seller. That’s because if the seller makes the mistake of issuing an installment agreement to an unreliable buyer, the seller could lose both the goods and the money.

Conclusion

So whether you need a personal loan or you need to purchase a new piece of equipment for your business, always be aware of the specifics when you contract for a loan of any kind. This is true whether you apply online or off. In other words, always read the fine print for any loan.



Source link

Filed Under: Biz Opportunities

About Asif Nazeer

My current sphere of interest is Internet Marketing - Worked for many years in finance and banking. I now consult for small businesses and starts ups. Also involved in venture capital for new companies.

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Sign up for our newsletter and receive a free EBook on how to boost productivity






Find it

Blog By

Small Business Consultant and Accountant helping grow your small business Read More…

Follow us online

  • Email
  • LinkedIn
  • Twitter

Recent Posts

The Benefits of Buying an Apartment in a Gated Community

Featured image from damacproperties.com Especially if you own a home-based … [Read More...]

  • 4 Steps to Take When You Quit Your Job – Careers
  • How to Find the Best Auto Insurance for Your Needs – Business
  • The Key Differences Between a Virtual Mailbox and a PO Box – Business

Archives

  • March 2023 (4)
  • February 2023 (2)
  • January 2023 (5)
  • December 2022 (5)
  • November 2022 (8)
  • October 2022 (7)
  • September 2022 (6)
  • August 2022 (6)
  • July 2022 (13)
  • June 2022 (11)
  • May 2022 (7)
  • April 2022 (8)
  • March 2022 (12)
  • February 2022 (8)
  • January 2022 (11)
  • December 2021 (9)
  • November 2021 (10)
  • October 2021 (11)
  • September 2021 (3)
  • August 2021 (10)
  • July 2021 (12)
  • June 2021 (5)
  • May 2021 (10)
  • April 2021 (17)
  • March 2021 (40)
  • February 2021 (39)
  • January 2021 (58)
  • December 2020 (66)
  • November 2020 (59)
  • October 2020 (34)
  • September 2020 (47)
  • August 2020 (37)
  • July 2020 (2)
  • May 2020 (1)
  • April 2020 (1)
  • March 2020 (33)
  • February 2020 (25)
  • January 2020 (20)
  • December 2019 (27)
  • November 2019 (28)
  • October 2019 (34)
  • September 2019 (38)
  • August 2019 (13)
  • July 2019 (44)
  • June 2019 (40)
  • May 2019 (58)
  • April 2019 (51)
  • March 2019 (43)
  • February 2019 (44)
  • January 2019 (43)
  • December 2018 (47)
  • November 2018 (43)
  • October 2018 (58)
  • September 2018 (44)
  • August 2018 (60)
  • July 2018 (49)
  • June 2018 (58)
  • May 2018 (54)
  • April 2018 (39)
  • March 2018 (46)
  • February 2018 (48)

Biz Opps

Featured image from … [Read More...]

Featured image by Andrea Piacquadio via … [Read More...]

Featured image by Jacob Morch via … [Read More...]

Customer Focus

First published in Exchange, the magazine of the … [Read More...]

Entrepreneurs

Uptown Cheapskate is a resale store for young … [Read More...]

A team of neuroscientists in the United States … [Read More...]

This article was translated from our Spanish … [Read More...]

Strategy

If you buy something through our links, we may … [Read More...]

In helping celebrate Black History Month, Facebook … [Read More...]

ZOHO started its current Email Marketing Basics … [Read More...]

Supply Chain

Although managing inbound shipping can be … [Read More...]

© Copyright 2015 iSmall-Business.net · All Rights Reserved · Powered by ISmall-Business.net · Admin