How to choose a cash loan or installment? First of all, it should be noted that the low interest rate of a loan is often just a marketing gimmick. Banks or financial intermediaries employing this rhetoric usually earn high commissions. Where is the best place to take a cash loan right now in 2015?
If you need a loan it’s usually the easiest and cheapest to settle it in the bank where you have an account. It can be recommended a revolving loan for account holders. You’ll only pay interest on the debt, and not the full amount of the loan. Each payment reduces your debt. In addition, you will pay a lower commission.
What to choose – cash loan or installment?
Cash loan is so attractive that the bank does not check, on which will the money be spend on. Bank pays money and is waiting for the return. Installment loan is transfered on an account of the shop or travel company, which you have to pay for a tv or a trip to Mexico.
How much money to borrow and for how long?
You can borrow quite a lot, even $100,000. It all depends on your earnings and expenses. You can generally assume that if you have on your savings account the amount of eg. $10000 – 20000, and your monthly receipts on account minus expenses shall not be less than 1500 dollars the you can rely on the $70000 – 80000 cash loan. Sometimes the bank may crediting 100%, and sometimes 80-90% of the value of commodity you wish to purchase. The term of the loan can take up to five years, and the longer, the higher the interest rate.
What are the Collaterals of Cash Loan?
At lower sums of loans you can simply sign the bill. At higher amounts you may need a guarantor. Other conditions to be met in order to apply for a cash loan is to have a regular place of work (or running a business) and to provide proof of earnings.
Such loans are an option for those people who need cash and that do not want to end the bank CD deposits (in order not to lose interest) or sell securities or bonds. Banks can borrow money secured by the assets. Unfortunately, for a short time, and usually at a rather high percentage. Interest will be deducted in advance from the amount borrowed.
Their representatives are in almost every shop with durable goods. Thay offer credit without much formality – usually sufficient proof of income and ID card. However, the commission from such a quick money is higher (6-9% instead of 1-3%) than in the bank, but the interest rate is similar. Where from these agents take money to provide such loans? Of course, from the banks and lend them in bulk, which is much cheaper than for the average Joe.
How to choose a cash loan? First of all, don’t be fooled by the low interest rate. Remember that banks earn commissions. Also check carefully the offers of credit intermediaries.
Effective interest rate, which some banks and brokers tempt their clients with, is lower than the annual nominal rate. Often in advertisements are only monthly installments shown – therefore require here to provide you the nominal interest rate, because this only allows you to compare offers and choose the best.