An Installment Loan is a loan that is paid back in multiple payments. For example, if you get a 2 year loan that requires monthly payments, you have an installment loan.
Installment loans can be used to pay bills, make purchases, take vacations and to combine several debts such as credit cards, personal loans and etc. into one monthly or weekly payment. Reducing the number of creditors on your credit report should help improve your credit score.