Key takeaways
- Regional Finance offers fixed-rate installment loans repaid over 6 to 60 months.
- Payday loans are usually due in about two weeks and often carry APRs of 300% or more, according to the CFPB.
- Rolling over a payday loan repeatedly can cost more than the original loan.
- Installment payments are reported to credit bureaus, so on-time payments can help build credit.
What is an installment loan?
An installment loan gives you a lump sum that you repay in equal monthly payments over a set term. The rate is usually fixed.
Regional Finance offers small installment loans from $500 to $2,500 (6 to 48 months) and large installment loans from $2,501 to $35,000 (18 to 60 months). Each payment covers interest and part of the principal until the balance reaches zero. Learn more on our Regional Finance personal loans page.
What is a payday loan?
A payday loan is a small, short-term loan, often a few hundred dollars, due in full on your next payday. Lenders typically charge a flat fee per $100 borrowed.
The CFPB notes that a typical two-week payday loan fee of $15 per $100 equals an APR of almost 400%. Many borrowers cannot repay in two weeks and roll the loan over, paying a new fee each time.
Side-by-side comparison
| Feature | Regional Finance installment loan | Typical payday loan |
|---|---|---|
| Amount | $500 to $35,000 | Often $500 or less |
| Repayment | Fixed monthly payments, 6 to 60 months | Lump sum in about 2 weeks |
| Typical APR | About 24% to 35.99% reported on larger loans; higher on small loans in some states | Often around 400% |
| Credit check | Soft check to prequalify; hard inquiry to finalize | Often minimal |
| Credit reporting | Reported to credit bureaus | Often not reported unless in collections |
| Rollover risk | None; balance amortizes to zero | High; fees repeat each rollover |
The true cost: a worked example
Imagine you need $500 for a car repair.
Payday loan
Fee of $15 per $100 = $75 every two weeks. If you roll it over five times before paying it off, you pay $75 × 6 = $450 in fees, and you still owe the $500 at the end.
Installment loan
Even a small installment loan at a high APR, say $500 at 60% over 12 months, has a fixed payment of about $56.41 and total interest of about $176.95, with the balance fully repaid.
These are illustrative numbers. Real terms depend on the lender and your state. Test scenarios in our Regional Finance loan calculator.
When a Regional Finance installment loan makes more sense
- You need more than a few hundred dollars
- You cannot repay the full amount within two weeks
- You want a fixed payment and a known payoff date
- You want on-time payments to count toward your credit history
If your credit is fair, read Regional Finance loans for fair and bad credit.
Better options to try first
Before any high-cost loan, check whether one of these can cover the gap:
- A payment plan with the repair shop, hospital or utility
- A credit union payday alternative loan (PAL), which federal credit unions can offer at capped rates
- An emergency fund, even a small one. See emergency fund vs emergency loan
- Help from local nonprofit or community assistance programs
Why Regional Finance installment loans are structured differently
Every Regional Finance payment reduces your principal. That structure, called amortization, is the core difference from a payday loan, where a rollover fee can leave the original balance untouched.
| Month | Installment loan balance ($500 at 60%, 12 months) | Payday loan balance ($500, rolled over) |
|---|---|---|
| Start | $500.00 | $500.00 |
| After 3 months | About $401 | $500.00 (fees paid, principal unchanged) |
| After 6 months | About $286 | $500.00 |
| After 12 months | $0 | $500.00 unless paid in full |
Illustrative only. The installment balances use a fixed payment of $56.41.
How to choose: a Regional Finance borrower's checklist
- Can I repay the full amount in two weeks without borrowing again? If not, avoid a payday loan.
- Does the installment payment fit within about 10% of my take-home pay?
- Have I compared the total of payments, not just the fee or the monthly amount?
- Have I checked a credit union, payment plan or assistance program first?
- Do I understand whether the loan is secured and what the collateral is?
See typical costs on our Regional Finance rates and fees page.
Installment vs payday FAQ
Is Regional Finance a payday lender?
No. Regional Finance offers fixed-rate installment loans repaid over months, not lump-sum payday loans.
Are installment loans always cheaper than payday loans?
Usually, in total cost, because payday loans have very high APRs and frequent rollovers. Always compare the total of payments.
Can an installment loan help my credit?
On-time payments reported to the credit bureaus can help build your payment history. Late payments can hurt it.
Can I use an installment loan to pay off a payday loan?
Many borrowers do, to stop the rollover cycle. Make sure the new payment fits your budget.
Start with the Regional Finance overview or see emergency loans.