logo
Advertisement

Taking out a Personal Loan

Taking out a Personal Loan

Taking out a Personal Loan

Taking out personal loans is something we all have to do at some point in our lives. No matter how far-sighted you are and how much you save, there will always arise a situation in which you need money and do not have enough liquidity, for example to start a business or to buy a house. As we want the experience to be as positive as possible, today we bring you some tips that you should keep in mind when borrowing money.

Assess your need for the money

There are many reasons that can lead you to the need to borrow money, but among them there are some that you should avoid. Before going to the bank, assess whether you really need the money and the obligation you are going to assume in exchange for it.

Advertisement

It is not advisable to borrow money to make an impulse purchase or to pay another loan or a trip that is not necessary. And if you know that the stability of your job is in doubt, it is much better to stay as you are.

Do the math right

Except in the case of a loan between family members, which may not have any interest associated with it, in all other cases if you borrow money you will have to pay back the amount you have borrowed plus the corresponding interest.

That is to say, your debt will not be just X but X+Y(the interest). This is something that you must take into account when you do the math and see if you can really afford the repayment of a personal loan, because the interest applied may make the monthly payment a little higher than you expected.

Advertisement

Find out about the banks that grant personal loans.

This banking product is quite common and all banks work with it, but not all of them offer the same conditions. In fact, you will probably get better conditions in terms of interest or applicable commissions if you are already a client of the bank or if you commit to link yourself to it by direct deposit of your salary or by contracting a credit card.

Think that the objective is to get the cheapest personal loan. So pay close attention to the applicable interests (remember to compare the APR), to the applicable commissions and to the links that are required of you.

If the interests are low but in exchange you have to contract a credit card and pay fees for it, perhaps the operation does not compensate as much as it seemed at the first sight.

Advertisement

Clear up all your doubts before signing

As it is not every day that we ask for personal loans, it is normal that the language used in the contracts associated with these products is a little complicated. Once you sign you are already linked to the bank, so make sure you first understand what you are signing.

Talk any doubts you may have with the bank's staff, and it would even be advisable to consult a legal expert. As the contract is signed in public deed, you can also take advantage of the visit to the notary and ask him what you do not understand.

Advertisement

Asking for a personal loan always has an associated cost, so evaluate your personal situation, the need you have for the money and the conditions offered by the bank. This way you will be able to make the smartest decision possible.

What we recommend is that you resort to this product as little as possible. If you organize your financial resources well, you can have an economic cushion that will allow you to face punctual needs of money and thus avoid having to ask for a loan or, in case you have to do it, the amount will be the smallest possible.

Advertisement

Related posts

thumbnail

Which type of Life Insurance is right for you?

thumbnail

Learn to Invest

thumbnail

Digital transformation of Banks

thumbnail

Which are the Best Mortgage Loans?

thumbnail

Liquidity in the Financial Market

Copyright © 2023