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Instalment Loans & Alternatives

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  • You could consider a credit card instead
  • Guaranteed credit limit
  • Check your eligibility with no impact to your credit score
Check my eligibility This won't affect your credit score

Representative example: Amount of credit £1,200. Interest rate: 34.0% pa (variable) Representative 34.0% APR (variable)

What does ‘instalment loan’ mean?

When you borrow money from a lender, you usually repay the loan via a series of regular payments – typically on a monthly basis, although some lenders do offer weekly repayments. These payments are known as instalments, which is where the term ‘instalment loan’ comes from. These loans can be secured or unsecured loans and can also be guarantor or non-guarantor loans.

Interest is added to your loan, so when all the instalments are added together, you’ll end up paying back the original amount plus the interest. At 118 118 Money, subject to eligibility, we offer instalment loans of between £1,000 and £5,000, over terms of one to three years.

Alternatively, if you’re considering a credit card, the 118 118 Money Simple Interest Rate Credit Card comes with a representative APR of 34%.  

Apply for a credit card from 118 118 Money with confidence
Use our eligibility check to find out what credit limit we’ll offer you before you apply, without affecting your credit rating!
Check my eligibility This won't affect your credit score
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Why choose the 118 118 Money Simple Interest Rate Credit Card as an alternative to an instalment loan?

Dependent on your own circumstances and the purpose you need to borrow money for, the 118 118 Money Simple Interest Rate Credit Card could provide an alternative. Here are some of the key features we can offer:

A credit limit of up to £2,000.

 

We don’t charge any fees. However, some third parties may charge you in some situations – when taking out cash from an ATM, for example.

Up to 51 days interest-free on cash and purchases when you repay your full balance each month.

Repay in full or in instalments to suit your situation. Bear in mind there’ll be a minimum monthly repayment and we always recommend paying off more than this if you can afford to.

You can check your eligibility without affecting your credit rating.

 

 

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Want to apply for a credit card?

  • Alternative to instalment loans
  • No fees*
  • Check your eligibility with no impact on your credit score
Check my eligibility *We do not charge any fees. However, third party vendors may have their own charges. An example of this is an ATM where a usage fee could apply.

Are there different types of instalment loans available?

If you’re searching for a loan in the UK, you’ll likely be presented with a number of different options available to you dependent on your credit history, the amount you need to borrow, and the loan purpose.  

Many of these different types of loans tend to work in similar fashion to one another, in that they are typically repaid in instalments. There can be differences in some of the features, for example a guarantor vs a non-guarantor; or a fixed rate rather variable rate loan – however most tend to be repaid in instalments.

Some of the other types of instalment loans can include:

Though this list isn’t exhaustive, it hopefully demonstrates that there are a number of different types of loans with differing features, but the repayment for all of them is usually in instalments.

How do I choose the right type of instalment loan?

If you’re thinking about taking out an instalment loan, it’s important to make a choice that’s right for you.

When applying for personal loans, credit cards or any form of credit, we recommend doing your research – especially if you have a less-than-perfect credit history. Check the APRs available for a range of different loan amounts and durations, so that you’re fully informed of all your options. You need to remember that repaying over a longer period may increase overall interest charges. If you’re consolidating and extending the term of your borrowing, make sure that you’ve taken this into consideration.

Our money guidance and financial tools sections will help you figure out how much you can afford to borrow and repay.

We’re here to help people in different financial situations, and we’re experienced enough to know that an instalment loan might not be the right solution for everyone. Before you apply or commit to one product over another, it’s important to weigh up all the available options; it could be that the 118 118 Money Simple Interest Rate Credit Card is a more suitable alternative to a loan, this is dependent on your needs and circumstances however.

Instalment loans vs credit cards: How do I decide?

If it comes down to a straight choice between credit cards and instalment loans, it makes sense to get an understanding of the key features of both. We’ve broken a few of these down in the table below:

 

Credit Cards

Instalment Loans

Representative APR

In some cases this can be lower than instalment loans

Dependent on your credit history and type of loan, these can be higher than credit cards

Repayments

To be made in full, or a minimum monthly instalment, or any amount in between

To be made via fixed monthly instalments, although you may have the choice to pay off early if you can afford it

Credit Limit/Amount

Works as a continuous line of credit, as long as it’s within the credit limit

The loan contract ends once the loan amount plus interest has been repaid in full

What do I need to qualify for a credit card?

If you think a credit card might be a more suitable way for you to borrow, you can check your eligibility before you apply. It’s free, takes only a few moments and will let you know if you’re likely to be approved. We’ll also tell you what credit limit we can offer, and you don’t have to worry about it affecting your credit score. Should you decide to complete a full application, we will conduct a credit search, this will be visible to other lenders.

To be eligible for the 118 118 Money Simple Interest Rate Credit Card, you’ll need to:

  • Be a UK resident
  • Be aged between 18 and 70
  • Earn at least £8,400 a year
  • Not be in arrears with another lender
  • Have had no default payments in the past six months

When using the eligibility checker, you’ll need to provide us with your:

  • Name
  • Email address
  • Date of birth
  • Current employment and residential status
  • Net monthly income
  • Outgoings
  • Home address

Will my application affect my credit rating?

When you apply for an instalment loan, a credit card or any other form of credit, the impact on your rating should be small. But it’s very important to note that lots of applications over a short period can have a negative impact on your credit score.

On the other hand, if you’re approved, you can actually improve your credit rating. Making repayments in full and on time each month and keeping up with other financial commitments helps to show that you can manage your finances responsibly. In turn, this could boost your chances of being approved for additional credit in the future. Some credit building credit cards can also help to improve your credit rating too.  

Will you do a credit check on me?

Yes. Whenever you apply for a credit card or an instalment loan in the UK, you will be subject to a credit check. It helps us to decide if we can approve you, but it’s not the only thing we’ll look at. Publicly available information, such as the electoral register and whether you have any CCJs, and other factors will also be a part of our review.

You can always use our eligibility tool to see if you’ll be approved for a credit card before you apply, this doesn’t impact your credit score, but if you then choose to apply, we will then conduct a full credit check. If you want to, there are ways for you to check your credit report as well.

What if I want to speak to someone?

Our team is on hand to help, so please feel free to get in touch.

The best way is to give us a call on 02920 548 118 – lines are open 8am-7pm Monday to Friday and 9am-5pm on Saturday, Sunday and Bank Holidays. Or you can use our web or app chat too.

Apply for an instalment loan alternative from 118 118 Money

Want to apply for a credit card with 118 118 Money? You can try our eligibility check first to see if you’ll be accepted before you apply – and it won’t affect your credit rating.

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Instalment Loans FAQs

Whether you take out a small or a large instalment loan will depend on what you need it for. The loan purposes can vary from emergency loans for unforeseen expenses to home renovations or weddings. Whatever the reason, ensure the repayments are affordable over your agreed period.

Yes. We offer instalment loans to UK customers and you can borrow between £1,000 and £5,000; subject to eligibility and affordability. You can choose to repay over terms of between one and three years.

Yes. When you apply for an instalment loan, a direct lender means you’re dealing directly with the people who are providing you with the funds. 118 118 Money is one such example. Your other option is to go through a broker, who will search around to try and find you the best product. Although we are direct lenders, we do use brokers too.

That will depend on your individual circumstances, but the APR on our instalment loans ranges from 49.9% to 79.9%.

Representative example: Amount of credit £2,000 for 24 months. Interest rate: 41.2% pa (fixed). 24 scheduled monthly payments of £123.64. Total amount payable: £2,967.43 Representative 49.9% APR.

The interest rate will be fixed, so your monthly repayments should always be for the same amount, which can help you to plan your finances with a little more clarity. If you would like to make a direct comparison, the representative APR on our credit cards is 34.0%.

That depends on how you look at it, as well as the loan amount and rate of interest. If you take out a short term instalment loan, the monthly repayments will be higher, but the overall cost could be lower because you won’t be paying interest for as long. But remember, higher interest rates could also lead to higher costs despite being shorter term loans.

So whichever you choose, it’s vital that you’re happy with the terms of your loan and that you can afford the repayments.

We are direct lenders of bad credit instalment loans, which means we consider applications from those who may have had issues with credit previously, so it may still be possible for us to help you. We know there’s more to your application than just your credit history, which is why we look at other factors too when you apply. Of course, no lender can ever guarantee approval before knowing all the details.

If you’re approved for a credit card, you should receive your card and PIN in the post within 10 days. If you’re accepted for an instalment loan, you could have the money transferred to your account within 24 hours.

If you’re declined for credit but then your situation improves and you’d like to re-apply, you can do so after 180 days. Please remember that lots of applications in a short period of time can negatively affect your score, which could make it harder for you to be approved in the future.

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Ready to apply for a credit card from 118 118 Money?

You can try our eligibility check first to see if you’ll be accepted before you apply – and it won’t affect your credit rating.

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