7 tips for asking for a personal credit
Buying a car, doing a renovation at home, or financing some studies are some of the main reasons to ask for a personal credit. However, in order to acquire this financial product, it is important to comply with a series of requirements, such as having a work contract or demonstrating sufficient financial solvency. In addition, taking into account other aspects such as, for example, the type of commissions or interest requested by the bank, can help to ensure that this financial product does not come out more expensive than expected.
1) Do not ask for more money than you need
A few years ago, when asking for a credit, it was common for the bank to offer you more than you requested. In this way, if the initial reason for requesting it was to change the kitchen in your home, you finally ended up reforming the bathroom, or buying new furniture. At present, the economic crisis has caused this trend to change, both on the part of banks and customers. The former no longer grant credits so lightly, and the latter request only the money they need to cover a particular purpose. And it is that, as is logical, the entities do not lend money altruistically. When you ask for a credit you will have to pay back the money that they have lent you, along with interest, commissions, etc., which will make the total amount to be owed considerably higher than what they lent you. Therefore, when you ask for a credit, you adjust the amount you want to request to the maximum and avoid paying more interest for it.
2) Return it as soon as possible
When the entity with which you hire a credit asks you how long you want to return it, try to make it as low as possible. You must take into account your income and ensure that it is a fee that you can assume periodically. After that, make calculations and try to adjust the amortization period as much as you can because the longer you take to return it, the less security the bank will have and the higher the interest will be. In fact, this is one of the factors that makes the price of credits more expensive. On the contrary, if you pay installments of a higher amount, in a shorter period of time, you will amortize the credit sooner and it will be more economical.
3) Do not delay in payments
When you hire a credit, it is very important that you pay the installments in the term you have set with the entity, without delaying a single day. If you meet the payment later than the contract contemplates, the entity may penalize you by applying interest for late payment, which is usually much higher than ordinary interest. If this situation is repeated, or you stop paying a monthly payment, your debt will not disappear, but it will increase and they could end up seizing your assets or bank fees. Therefore, before asking for a credit make sure you can meet the payment of it and above all, meet the payments within the deadline!
4) Justify the expense
When you ask for a credit, most entities will ask you in what you intend to invest this money, since it is information that gives them some security. It is not the same thing that you want a credit to settle previous debts, than to buy a car. For this reason, most entities offer specific credits for the financing of a specific purpose, for example the purchase of a car, the reforms of the home, the studies, etc. These products have specific conditions and advantages. However, in order for the bank to grant you these benefits you must prove with the corresponding documents that the end of the credit is the one you have indicated.
5) Do not resort to “quick money” and without guarantees
When you apply for a credit, entities usually take a few days to confirm that you are eligible to lend you money. For this they will ask you for contributions that demonstrate that you can return it. If you are an employee, the most common is that they request your payroll, which must be of sufficient income, and your work contract, which may require it to be indefinite. If you are self-employed you will also have to prove economic solvency through invoices, bank statements or other documents.
However, there are some entities that offer “quick money” and without the need to provide payment guarantees. You must be careful with this type of credits, since they could charge you higher interest or commissions than the other entities.
6) Look at the APR
When hiring a credit you not only have to pay attention to the interest that they will charge you, but there are also other conditions that can make your credit more expensive. Thus, when you ask for a credit or a credit, many entities may demand that you contract certain products such as insurance or cards, or charge you certain commissions that can make the product cost much more expensive than it seemed if you only took interest into account. Therefore, when you are going to contract a credit, look at the APR (Annual Equivalent Rate), which is what includes the total cost of the credit, including commissions, interest, expenses and commissions.
7) Compare Personal Credits
Undoubtedly, the best option to get the most suitable credit for each person is to compare the different products that are available in the market and offered by the different entities. The personal credit compare does it for you. Select the amount of money you need and fill in the information of the questionnaire and in a few seconds you will be able to know the credits that you have at your disposal. In this way, you can choose the credit that suits you best and avoid paying more money than necessary for it.