Today, consumer loans are the most popular types of loans. This type of lending differs in that the bank does not keep track of where the money will be spent.
From an economic point of view, the loan is unprofitable for the borrower. The bank takes risks when issuing a consumer loan, since it does not receive property or insurance of goods from the guarantor as a pledge. In this regard, the credit institution includes all risks in the interest rate.
Tips for obtaining a consumer loan
First, you need to carefully analyze all your income and the need for this acquisition, because the main condition of any bank is timely payments. Otherwise, you will be charged forfeits and interest.
It is better to choose a well-known bank, because then you will protect yourself from various problems.
It is worth analyzing in advance what your chances of getting a loan are. Sometimes credit organizations set age limits, for example, not to issue loans to those who have not reached the age of 25.
Study the interest calculation scheme carefully. There are two main types: annuity and classic payments. The classic scheme is the accrual of interest on the unpaid value of the debt, and with an annuity, it is necessary to pay off the loan in equal installments.
Very often banks are silent about the commission charged and try to focus on a profitable and low interest rate. Credit institutions can charge commissions for payments on a monthly basis or once. In this case, the commission is charged on the entire loan amount, regardless of what debt remains.
It is also worth considering the option of obtaining a loan not at a bank, but at a retail outlet. However, this is only possible if the bank holds a promotion in the necessary store, according to which no interest is charged on the loan.
