Sometimes a person has a dream that can only be fulfilled at any given moment with the help of a cash loan. It can be used for any purpose. Maybe it is the renovation of the apartment, some trip, travel, equipment to develop a passion? However, you should never forget that it is a commitment. When collecting cash loans, you have to plan everything well in order not to fall into excessive debt. If you analyze this correctly, the cash loan will not be too much of a burden for you.
When choosing a bank or financial institution, regarding the cash loan, you have to be careful about the catchy slogans “0% commission” or “the lowest interest rate on the market”. This does not mean that you will not incur any costs associated with the loan. Therefore, the parameters for which you must pay attention during your choices will be described below.
What should you pay attention to when looking for a cash loan?
- The cost of credit – one of the most important aspects. Remember what this cost consists of. The fact that the commission and interest rate will be reduced to zero does not mean that it will be the cheapest loan. Pay attention to the APRC (real annual interest rate), i.e. the total cost of the loan, which includes the costs of receiving the loan, commission and interest rate.
- Budget analysis – before you start looking for a cash loan, determine what you can pay the monthly installment. Do not take credit on impulse. Check your expenses and income. If you take a cash loan, then will you be able to keep paying for your monthly installments? If you extend your loan repayment period, you will reduce the installment, while the total loan price will increase.
- Purpose of a cash loan – is optional, you do not need to inform the bank how you transfer money, but remember, if you want to buy a car, a mortgage loan will be a cheaper option.
- Repayment of the loan on time – it is very important, because if the bank reports you to database, in the future you will not have it easy to get another loan, in addition, you can accumulate further large interest.
- The insurance is not obligatory – think if you need it if the loan amount is not high. Insurance is an additional cost, it is mainly secured by the bank. The insurance company repays the remaining debt if the borrower’s death or inability to work.
The bank may give you a lower interest rate or commission if you buy the loan insurance. Mostly, it is not profitable for you. It is your bank’s responsibility to provide you with an information form before you sign a contract. The document must be shown in a simple form and contain information about all fees that you must pay with a cash loan. You can withdraw from a cash loan even after starting the loan. You have 14 days to withdraw the signed contract. The amount to be refunded must include interest for the time from the date of payment of the loan until the repayment of the liability. You also have the option to pay off the loan early, you can pay off the whole, but first check if you do not lose because the bank may charge you an additional fee to pay the loan ahead of schedule.