Best personal loans

Best personal loans online

At our bank counseling, the question of borrowing (consumer credit), credit card or overdraft is quite often repeated. These small loans, predominantly in the order of 1-10 thousand $, are significantly more accessible to a wide range of clients compared to other loans with larger volumes or mortgages. Nevertheless, the provision of such small loans has its own clear rules, and in the interest of both the bank (the credit provider) and the client (the borrower) not everyone will eventually get the loan. So what are the rules of the game dictated by the bank and our chances of getting credit?

Personal loan rates

Small loans serve to bridge the shortfall of money in the short term. We want to buy something, but we have not got it. The main purpose of these products – consumer lending and, in general, non-investment items – is already called “consumer credit”. For more on the (non) sense of consumer credit, read our “We Borrow Responsibly” here. A totally solvent client with good income is rarely in the position of an applicant for this type of loan, because he simply does not need it, because he has “saved”. Typically, an individual who does not have too high a regular and proven income or has a different “complication” (single mother, maternity leave, pensioner, disability pension, existence of other debts, the debtor of the debtor in the registers, etc.). Thus, the existence of one such complication does not necessarily mean that the bank rejects the loan application. It is a little bit like this, and so, for example, interest rates on consumer credit are multiplied more than mortgages (usually, of course, it also plays zero or less reinsurance). In short, we have to convince the bank that we will be able to repay the loan and that there is only a minimum risk of default. If we are not 100% sure that the loan is due, we are not asking for the loan (this is not a lottery). If we are fully certain that the loan will be repaid and the bank still rejects the credit with the fact that our self-esteem is not shared, the bank acts only in good faith, thereby protecting us from the risk of unpaid credit, legal proceedings, execution and personal bankruptcy. The Bank also protects itself because the bank’s aim is to borrow money at a higher interest rate than what other money has deposited with it and to earn interest rate differences rather than personal bankruptcies (unlike most non-banking institutions, see below). Any unpaid credit and eventual court proceedings with execution will generate additional costs for the bank to avoid. Certainly, income from the execution would even cover all additional direct costs, but also the energy spent by the bank, which no one pays (time and power spent on judicial and enforcement proceedings). It is therefore better not to get a loan and not to spend the desired holiday before surviving the subsistence level until the end of life.

Low interest personal loans

It is absolutely necessary to meet the condition of the minimum regular and demonstrable net income required for the loan (depending on the length and volume of the loan). The minimum possible income is around 8,000 $ for the most tolerant banks. Below this limit, no bank will lend you anything. And how to estimate the minimum required minimum exactly for our loan? Almost every bank on their site offers the opportunity to calculate the loan on the credit calculator. Enter how much and for how long we want to borrow and get the amount of the monthly installment (orientatively for a loan of $ 50,000 for 2 years about $ 2,400 per month). Do we have to pay such a high amount on a monthly basis? Most items in our personal or family budget are more or less fixed – housing costs (rent, energy), food expenses, drugstore, medication, school children, nurseries and related costs, and other essential items. So if we add up all the necessary expenses and add a reserve of at least 10-20%, we should have enough to cover the calculated installment. If this is not the case, we are not likely to be able to repay the loan (successful repayment is closer to the level of the game than the careful calculation of our options) and therefore it does not make sense to ask for it. The Bank has these costs already calculated and standardized according to what they consider to be reasonable according to their long-term experience. As a rule, we only ask questions about basic family circumstances (number of children, married or single, living in own or in rent, other liabilities, etc.) and the bank will already estimate if the loan is sufficiently solvent.

How to get a personal loan online?

Regular net income must be verifiable and does not matter much to its source. Can the other benefits (maternity, disability pension, etc.) come from the job as well as from the old-age pension, provided that the benefit is secured without the risk of loss until the loan is repaid. On the contrary, we do not count promised contributions from our dear half or parents (not how to declare their legality) – these individuals can be max. Co-borrowers on loan or guarantors (both do not recommend).

Personal loans for people with bad credit

If we pay off other debts or have other obligations, we have to get enough to cover all repayments after deducting the necessary costs – if not, we will not get a new loan. By solving this, consolidation, that is, merging a new loan and old loans or other obligations into one larger new loan, which would be repaid for a long time, thereby spreading the installments over a longer period, would fall and we would be relieved if we find ourselves in the difficult financial situation. However, the journey is very inappropriate (we are going through our future very much) and I would recommend it only in rare cases where it can be demonstrably saved on interest and fees (in absolute terms) or the last rescue before the execution and personal bankruptcy.

Quick personal loans and lowest personal loan rates

Negative records in the registers are unpleasant as they clearly demonstrate our deteriorated payment morale and insolvency. The vast majority of banks put their hands away from such clients and lend the few remaining banking institutions for significantly increased interest, which covers the risk of possible problems. With a record in the registers, the loan can be obtained, but it will cost more effort, time and money.

Fast personal loans

Where to borrow and where not or what are the differences between banking and non-banking institutions. Credit unions Consumer loans to individuals do not provide (theoretically they can, but they are not available in practice), so we will limit ourselves to banks and non-bank lenders. For banks, the loan is safer, as the bank accurately estimates our ability to repay and does not lend us anything that it thinks could get us into trouble. This, unfortunately, can not be said of most non-bank credit providers.

Personal loan companies

Certainly, there are a few decent (one-fingered) non-banking institutions that lend you still reasonably responsible, but the vast majority of these lenders do not play fair play, and the business model is rather based on fines for unfulfilled terms that such institutions he suspects that he is a client rather of failing and executing property, especially lucrative real estate. To write down such a non-banking institution is equivalent to the fairy tale of the devil’s soul, except that you will get much less and you will suffer much more.

Thinking about what to choose the most suitable consumer credit or short term personal loan for yourself?