The private lending industry also is home to a large number of small private credit institutions which are characterized by aggressive advertising and speed in processing requests, but that in return charge a fee higher than that of traditional institutions .
These are specialized financial segment microcredit loans of an amount not exceeding $ 3,000. With a high financing costs, nominal interest is around 20% annually and can reach even a 22.9% and the APR is up to 24'6%.
The granting of a comfortable and fast consumer credit conditions triggered can hide under the fine print and, what is presented as a great opportunity to meet a sudden, it becomes a cost higher than expected. For a credit of $ 3,000 with an APR of 24'6% after 12 months will have paid 415 euros in interest.
Thus, the advantages of easy credit and immediate are more related to comfort, all efforts are made by telephone, with the monetary benefits themselves.
Rights of the holder of a personal loan
Before concluding the contract, the lender must give you a binding offer to the conditions of the loan, to be observed for at least 10 business days. You can then compare offers.
If your loan is tied to purchase of a product, and returns the product, the contract is canceled at no cost.
You have the right to be informed of the amount of the installments in an amortization table.
In loans tied to purchases made in shops, can perform the operation with the entity you want, without having to hire you to suggest the establishment.
If you accept the offer of the financial institution has the right to review the policy before it is signed and should do so carefully, paying particular attention to the conditions of interest rate, fees and expenses, guarantees and term.
Tips
Before applying for a loan, review your personal credit history. If your income has been erratic and the red are common in your book, will be more complicated than it awarded.
Objectively assess your ability to borrow and be realistic about the level of consumption that can be allowed.
Set up a repayment term according to their means. Note that, although longer term to pay the monthly fee is lower, will eventually pay more interest. A shortest-versa.
To meet payments of small account, look for other options with lower interest rates than those applied to personal loans.
Advertising in-depth analysis of financial institutions. Look past the advertising claim and have all the information you need. In any case, know that the institutions are obliged to respect the contractual conditions offered in your advertising.
Compare the same product in multiple entities. The best reference to compare the different offers is to examine the APR of the product, it expresses the actual cost of the loan (including nominal interest, commissions, insurance ...). In any case, ask about fees and charges to pay.
When studying several offers not forget to ask for a simulation that includes the full amortization table loan. This box allows you to make appropriate comparisons.
Feel free to negotiate both the interest rate as each and every one of the committees that try to pass the credit institution.
Verify that the contract comprised the following:
1. The indication of SAD If not included, your obligation will be reduced to pay the legal interest in the agreed timeframe.
2. An account of the amount, number and frequency of payment dates should you take to repay the credit. If not specified, will reduce its obligation to pay the price in cash or the credit rating of the agreed deadlines.
3. The relationship of elements that make up the total cost of credit, having expressed the need to sign, where applicable, insurance amortization of death, disability, illness or unemployment of the holder. If you did not mention, not may require the payment of expenses not mentioned in the contract or the establishment or renewal of a security.
Seek-and-keep a copy of the contract and all receipts or documents relating to the loan.
Verify that the loan receipts apply the terms agreed in the contract, and if you have any questions or are dissatisfied with the position of a fee, go to the branch to resolve the problem.
The agencies often require the intervention of a notary public at the time of signing consumer credit and personal loans in general, and this is so in order to provide these contracts of executive action in case of default of the borrower. Usually this cost is at your own client, but need not be. Negotiate who bears the cost of the notary.
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