In modern life, a fairly large number of people use different services of banking organizations. Judging by the advertising, each financial institution promises excellent credit conditions and flexible terms for the payment of a debt. However, despite the simplicity of obtaining a personal loan, there are many tricks that can be found in its terms.
What Should Be Alarming?
In any case, credit is a convenient tool if you know how to use it correctly. Borrowing money requires responsibility, discipline and the right approach to choosing a lender. Experts have determined what to avoid if you want to get a loan:
- Too favorable offers. A low or zero interest rate is usually a way to disguise a bonded offer. The agreement may indeed stipulate that you will receive an interest-free loan for a certain grace period (for example, for a month). Ultimately, the rate will be higher than from competitors, and all benefits will be leveled.
- Mandatory purchase of insurance. Banks and other credit organizations require it but you can refuse this service because it is justified only with collateral lending.
- Lack of additional payments. Remember that commission is paid for opening and maintaining an account and for each transfer of money to and from it. Therefore, this moment needs to be checked in advance.
- Absence of down payment. The total real cost of a loan, in this case, is much higher than a low rate credit. This is just a trick designed to lure customers.
- The possibility of early repayment of the debt. It is very unprofitable for a bank when a client pays all duties ahead of schedule because the financial institution loses its income. Before signing the agreement, it is worth checking the presence (or absence) of this condition to avoid misunderstandings in the future.
Remember the Simple Rules
Experts advise, first of all, to think about the necessity of getting into debt. If you really need to apply for a loan, remember that an interesting advertisement and a bright signboard are not the best criteria for choosing a bank. The market is full of offers, so review options in several organizations. Compare costs to choose the credit that suits you as much as possible. Do not be too lazy to read the entire text of the terms – it will save your time and money in the future. If something is not clear, ask the staff for an explanation or consult with a lawyer. Sign the contract only when you have clearly understood everything.
Vigilance and prudence are two of your main weapons when applying for a loan. Remember that credit is a big responsibility and if the financial institution tricks you, the law is on your side. The main thing is to fight and assert your rights.