Cash loans are classified as inappropriate, because the borrower can dispose of the money at his own discretion. This includes the purchase of goods and services, and the opening of your own business, and tuition fees.
Everyone has their own plans for borrowed funds. The credit organization never checks what exactly the money is spent on. The main thing for the bank is that the loan is paid in full on time.
Benefits of lending
- Fast decision making. Financial organizations consider an application for a loan in a few days, and in this case, a decision can be made in a couple of hours.
- The minimum package of documents. The amounts issued in this way are small, which means that the bank only needs to provide a passport and an application.
- There is no need for guarantors. Often, when a person asks his relatives or friends to act as a surety, they refuse, which spoils the relationship between people.
Cons of lending
- Cash loans are accompanied by a high interest rate. This percentage is 1-2 times higher than what it would be if a certificate of income was provided. And since there is no guarantor, a document confirming the solvency of a citizen and collateral, the bank begins to insure its risks through high interest rates.
- Potential age requirements of the borrower. Typically, the minimum lending age is 18 years. Also, banks set the maximum age for issuing loans - from 60 to 75 years.
If the borrower's salary comes from a bank card, then it is better to apply for a loan from the bank that serves this card, since most credit organizations provide preferential conditions for obtaining a loan to their customers.
