Loan on installments – how to choose it?

A month is not enough for you to repay the loan? Choose financial products that can be repaid in installments. Today, we suggest how to choose an installment loan and at the same time do not be afraid of the costs of your decision. Check it out!

Companies providing loans in installments allow clients to incur liabilities even in the amount of tens of thousands of zlotys. Of course, such loans can not be repaid “on the spot”. For this reason, loans in installments are usually granted for a period of three months to three years.

Due to the amount of the amount borrowed, the procedure for applying for such a product is slightly more demanding than in the case of payday loans. First of all, it will be necessary here to have a stable income and high creditworthiness. Of course, a loan in installments still does not require as much formalities as, for example, a loan in a bank. So if we need more cash and we care about the time, choosing such a product can be a good move.

How do you choose the best installment loan for you? The tips below are helpful here:

How do you choose the best installment loan for you? The tips below are helpful here:

1. Estimate your financial options

1. Estimate your financial options

When financial problems arise, we usually know how much we have to borrow. It is worth, however, at this stage to consider how we will manage to pay off the obligation. To do this, you need to analyze your monthly income and expenses and answer the question of what part of the remaining amount we will be able to spend on repayment of the loan. Knowing this sum, we will better match both the time of repayment of the liability and the amount of the installment, and thus we will minimize the risk of ill-considered debt.

2. Determine how much time you need to pay your debt

2. Determine how much time you need to pay your debt

As we have already mentioned, repayment of the loan can be divided into up to 36 installments. Thanks to this, our monthly installment will be much lower and it may not be too burdensome for your home budget. On the other hand, a longer period of using the loan means an increase in its costs. Giving debt in installments, we will not feel that much, but if we look at the total cost of the commitment, we will see the difference in price between a loan for a year and that for three years. Knowing your own financial capabilities, we should therefore consider whether it is more profitable for us to borrow for a shorter period with a larger installment, or for longer, thereby increasing the final cost of the loan.

3. Compare the cost of loans and the amount of monthly installments

3. Compare the cost of loans and the amount of monthly installments

Loans on installments are currently provided by many non-bank companies. However, the prices of such obligations may vary depending on the loan brand chosen. It is worth checking how much the loan we need in different institutions costs. By using online loan offers, we will do it using the sliders available on the lender’s website or using the loan comparison engine. Of course, the attention should be paid not only to the total cost of the loan, but also to the amount of the monthly installment. In this way, we will reject the proposals that will seem the most expensive at the outset.

4. Familiarize yourself with the loan documents

4. Familiarize yourself with the loan documents

When we choose a loan company with the best offer for us, we need to read the contract. Let’s thoroughly analyze this one the document pays particular attention to the dates and costs of our commitment. Although the offer presented on the website should include all fees for the liability we have incurred, it is worth making sure if the company requires, for example, additional operating fees, whether it charges such costs once, including installments, etc.

What’s more, it is also worth knowing the policy of a given lender in the event of problems with the repayment of debt on time. Although no one assumes problems with the return of the loan, it is good to be aware of what to do in such a situation and how much additional costs entail possible delays.

5. Find out the opinions about the lender

5. Find out the opinions about the lender

Even if the lender does not raise any doubts in us, it is always worth checking opinions on the subject circulating on the network. Why? No one better than previous clients of a given company will tell us how the offer we choose looks like in practice. Perhaps the lender does not pay money as fast as he promises, or he requests additional documents that were never mentioned before. Such things are only able to catch people who have already lent in a given institution. So let’s take advantage of their experience.

6. Set the appropriate day to pay the installment

6. Set the appropriate day to pay the installment

If the lender approves our loan application, we will receive the relevant documents for signature. When analyzing the loan agreement, it is necessary to pay attention to the schedule of payment of the liability installments attached to it. Let’s see if this date falls around our payday. If not, it is worth moving it to the day when the remuneration affects our account. In this way, we will always have funds to repay the loan. What’s more, in order not to forget about the dates, we can also set a permanent transfer order from our account to the lender’s account.

About: Chang Rose