Month: March 2019
Despite the gradual economic recovery, there are still many Italian families who decide to apply for a loan in the bank to carry out their project , such as renovating their home and buying a new car, or simply to get more liquidity.
We are talking about the so-called consumer credit , a financial product that allows a person, precisely the consumer, to satisfy a certain private need. It is in fact a loan that can be requested only for personal purposes and that therefore concern the family sphere.
What is consumer credit?
Specifically, consumer credit then takes the name of a finalized loan, when the lender pays the sum directly to the seller and when the applicant, to obtain the credit, must specify the use he will make of it later. Instead we talk about personal loan, or not finalized, when instead we can use the requested sum as we believe and without having to justify the end.
Precisely because consumer credit is a rather widespread form of financing, it becomes important to know the ABC, so as to arrive prepared if you decide to request one. Not surprisingly, the publication of the Guide of the Bank of Italy on consumer credit, designed precisely to facilitate the understanding of this issue even to those who are not very familiar with this complex topic, is recent.
In the wake of this initiative, we at SuperMoney have also decided to provide you with some useful tools to move more easily and without risk in the consumer credit sector. So let’s see below what are the factors to watch out for if you are also going to request a loan from your bank.
Consumer credit: distrust of “easy” loans
First of all, you should know that you can generally apply for funding if you are between 18 and 75 years old . However it is worth noting that before granting the loan, the bank will verify the so-called creditworthiness .
In other words, you will have to show the credit institution to be able to repay the loaned capital according to the deadlines agreed upon in the contract. Precisely for this reason it is important to be wary of those who promise “easy” funding to anyone . In this regard, always remember to carefully check the interest rates and ancillary costs reported in the contract so as to avoid encountering nasty surprises.
Consumer credit: learn to read advertisements
Finally, if you intend to apply for a loan, how do you interpret advertising messages? In theory, promotional messages should provide a first orientation to help the consumer select the best credit offers. Unfortunately, too often, it is not so easy to easily evaluate the convenience of financing .
In general, good advertising should indicate:
- Interest rate on an annual basis
- Expenses that determine the total cost of the loan
- Total amount of funding
- Total amount due
- Amount of individual installments
Furthermore, a clearly written announcement should also give the APR the same visibility as all other information , for example by providing a concrete example so that you can understand the characteristics of the credit product more clearly.
Last technical note: finally pay close attention to the advertisements that refer to “zero-interest financing” . In these cases, it is in fact important to always check that not only the TAN but also the APR of the loan is equal to zero .
If you are in debt, you can use the personal loan to pay off your debts.
But pay attention, personal loan should be used to exchange more expensive debt for cheaper debt, such as credit card debt and overdraft specials that increase rapidly. In these cases, it is worth exchanging that debt for the loan, as a way to keep in control your finances.
Companies offering personal loans
Some companies offer personal credit quickly, securely and reliably, and most importantly, without the bureaucracy of many banks, check out our suggestions:
The company offers loans ranging from R $ 200 to R $ 3000, with terms of payment of up to 12 months and monthly rates of 11.7% to 15.7%.
If you need bigger values, maybe Rebel is a good option. It offers loans ranging from $ 1000 to $ 25,000, and can be paid in up to 24 months, with friendlier interest rates ranging from 2.9% to 9.9% per month.
If you are denied, then Simplic should be considered as an alternative when applying for a personal loan. It offers loans ranging from $ 500 to $ 3500, and can be split in up to 12 months, with a fixed interest rate of 15.8% per month.
Another option for those who are denied is Noverde. Fintech offers loans ranging from R $ 500 to R $ 4000, and interest ranging from 7.9% to 15.9% per month, with a possibility of payment in up to 1 year.
When is it worth getting a loan to pay off debt?
Here’s how to pay off a loan to pay off a debt:
When interest on the loan is lower
So-called compound interest are good when you are investing, but they can also increase your debt a lot if you do not pay the installments.
So if you get a loan where the interest rate is lower than the one applied on your debt it pays to acquire this type of service.
To get away from the credit card rotary
Credit card rates are one of the most expensive in the financial market, getting around 15% a month. So, when you paid only the minimum of the card, the rest of the amount was automatically funded.
From 2018, the Central Bank stipulated new rules and increasing the debtor balance became more difficult. Now the customer can only pay the invoice minimum for 1 month.
If the customer is unable to pay the bill in full in the next month, the bank must propose financing (with interest of up to 10% per month).
Despite these changes, it still pays to take out a loan to repay debt.
To clear your name
Many lenders offer advantageous discounts to anyone who wants to pay off their debt. So if your goal is to clear your name, getting a loan may be worth it.
You negotiate with the lender to get a discount and take out a loan with interest rates lower than that of your current debt.
And between 3 and 5 business days after the payment of the first installment or the total value of the debt, your name is already on the SPC / Serasa list.
To get discount with advance payment
Serasa annually holds an event so that negative people can regularize their situation. Generally, in this market it is possible to negotiate the debt with discounts and to remove the debts. There are cases of reduction of up to 90% of the debt.
Another situation is to try to negotiate the debt repayment directly with the lender. Once you realize that you have the value to pay off the debt, it is very likely that the company would rather receive a lower amount than not receive the payment.