Experienced non-traditional lenders have seen successful patterns of people taking out loans, paying them back on time, and applying for another loan in the future. Interest rates are very high for installment loans, but they are the only option for those with bad credit. In an effort to encourage and reward repeat borrowers, lenders are beginning to offer rewards programs.
How it Works
Each lender determines the requirements and benefits of a program. One lender, Blue Trust Loans, issues club cards at different levels. It is free to apply for a club card and clients can move up the levels to enjoy higher loan amounts, longer repayment terms, and slightly lower interest rates. The first club card is blue and is obtained once a client has completed two loans with on-time payments.
The blue club card entitles carriers to apply for loans of up to thirteen-hundred dollars with one-hundred and eighty-day terms. The next level is silver, with higher loan amounts and two-hundred and seventy-day terms. A gold club card makes clients eligible for three-hundred day terms of repayment and loan amounts of up to one-thousand, seven-hundred and fifty dollars. The highest club level is platinum with a loan limit of two-thousand dollars.
While it may be tempting to take out a high-interest loan for a vacation or new home theater, it is not wise. Saving for desires is the best and most cost-effective way to get them. Loans of this nature should be reserved for emergencies only. The costs do not make them conducive for casual uses.
Borrowers also need to read each loan agreement completely before signing it. If there is something you do not understand, ask the company representative for a detailed explanation. Never sign anything that is not completely understood because loan agreements are legal documents. Once that agreement is signed and that money accepted, the borrower is legally responsible to fulfill all the terms and conditions of the loan.
Try to borrow the money from a family member first. That situation may get awkward if repayment becomes an issue, but it will not cost nearly as much as a late installment loan payment. Ask an employer for an advance on salary. It may not be within the policies of the employer, but always ask to avoid high-interest loans.