When there is an urgent need for money, and relatives and friends cannot help, the question immediately arises where it is more convenient to take a cash loan.
Which institution to choose: Bank or PDA, pawnshop or MFI? The prospective borrower must soberly assess his strengths and benefits because ultimately it is these criteria that will explain where to obtain a profitable cash loan.
What is consumer credit
Consumer loans are money that a bank or other credit organization issues to a borrower. The money issued must be returned in monthly installments, with the payment of compulsory interest using other people’s money.
Consumer loans are divided into several categories. We will now consider them.
By creditor type
We will try to find an answer to the question, where it is better to get a cash loan – in a bank or in a consumer credit cooperative. This means that the lender can be not only a bank.
By target type
Bank loans are divided to obtain money to buy a particular product or service. It is a target loan, which is characterized by more favorable conditions: reduced annual rate, flexible conditions for its repayment, as well as the possibility of obtaining a state subsidy (to take advantage of targeted loans for education with state support).
The borrower does not accept money when drawing up the target loan in cash, it is transferred directly to the supplier of goods or services in cashless form.
By contrast, a loan that is not lent involves obtaining cash that can be used at its own discretion and does not provide the credit institution with a report on the credit funds issued to the borrower.
By security type
Credits can be closed for security, such as collateral or bail. Assets (movable and immovable) may be used as alien. If the borrower has a financial situation for which he will not be able to repay the loan, the bank will take over his pledged assets. If there is a bail agreement, then if the borrower cannot repay the loan, this obligation will be assigned to its guarantor. While ensuring safety, the annual percentage is lower than without it.
Unsecured Loans or OtherLess, issued by the Bank only to the category of borrowers who have stable income and authority in credit history. The amount of funds spent in this case is within the existing capital of the bank but at a higher annual rate.
By type of debtors
This category is further divided into several groups. For example, families of young people under the age of 30 receive a consumer loan with state support. Such a loan can be targeted (mortgage, car loan) or universal (without special-purpose financing).
When considering the next populacedostaním answer the question where it is more convenient to take cash loans to pensioners. Consumer loans provided by the Bank to pensioners are based on a stable source of income in the form of a pension. In order to use this type of loan, it is necessary to keep the assumption – pensioner-debtor must work. Obtaining retirement and employment will allow the pensioner to obtain cash on more favorable credit terms.
Trusted type of loan – applies to borrowers, has a positive credit history and re-applies to the creditor bank. When re-applying for a debtor, it will be sufficient to complete the minimum formal procedure, after which he will be immediately granted a loan.
By type of repayment
There are two ways to repay the loan.
Standard – installment. This is a single payment amount that is paid monthly or quarterly. The payment amount can be fixed or variable.
One-off – consists of a one-off payment of cash on a specific date specified in the credit agreement.
Subject to conditions of provision
One-time payment – issued by the all-round debtor. This type of loan is the most popular. The Bank assesses each borrower’s application on an individual basis and the amount of funds issued is calculated on the basis of solvency.
Renewable payout is based on the fact that the borrower will not be issued the entire amount of the loan at the same time, but in a gradual transfer within the agreed time period. The positive point, in this case, is that the borrower can be sure that he will receive the amount of money he indicated in the application.
By type of conditions
Where is it more convenient to take a cash loan in Russia, given the economically unstable situation? Russian banks that provide loans to the population today conditionally divide them into short-term, where the repayment period is less than one year and long-term over this brand.
Short-term loans are issued for a certain period (usually not exceeding 12 months) or on-demand. Thereafter, unless there is a fixed period for repayment of the loan, the Bank may at any time require repayment of the debt from the debtor.