The holiday season has started, everyone is eager to rest and travel, but the headache is the lack of money.
Source: MONDO/Samir Cacan
People often solve the problem of lack of money by turning to banks – minus and quick cash loans are allowed there. When the summer vacation is over and the tan fades, debts and financial entanglements remain. The biggest debtors are those who opt for the permitted minus – when taking out this bank loan, you should be especially careful – it makes it more expensive.
Allowed minus, as well as illegal, but also cash creditare particularly attractive at this time of year, because they offer users the opportunity to get extra money and provide themselves with a summer vacation without worrying about the budget. However, you should think twice, because the interest rates on these types of loans are astronomical.
Allowable minus
When looking at bank offers, the allowed overdraft of the account, better known as the allowed minus, seems like a good option. It is a loan that banks grant to clients based on their monthly income. The bank makes a certain, limited amount available to the client, without knowing whether, and up to what amount, the user will use it at all. The amount approved for a period of one year can be at most the average salary of the client in the previous three months. The client can use these funds according to his needs. So, he can use the amount at once, spread it over a year or use only a part. The procedure for approving the permitted minus is simple and without a lot of paperwork – all you need is a certificate of employment and the amount of income.
At first thought, the allowed minus may seem tempting, but it is this is actually one of the most expensive bank loans. Interest rates range from 10.64 to 34.51 percent. The interest is calculated based on the amount that the client uses, and on the number of days spent in the red.
Also, it should be borne in mind that the allowed minus is not a gift from the bank, and that in addition to the amount of interest, the user must return the money he spent, and the only way to avoid paying huge amounts is for the user to regularly reduce the debt, and not it uses the maximum amount of the allowed minus, given that the interest will then be lower, because it is calculated only on the amount of money spent.
When the period for which the minus is approved expires, which is usually one year, although some banks offer a longer period, the user must repay the entire amount of the loan. So, if right before the end of the contract, the user’s balance is not positive for at least one day, there are high chances that he will have to get hold of a large amount of money in order to provide zero on the account, which can be stressful, even impossible.
Illegal minus
In addition to paying an enormous sum of money only in interest, careless use of the allowed minus can lead to – an illegal one. A user who exceeds the maximum amount “enters” an illegal minus, a type of loan with the highest interest rates, which go up to an unbelievable 55 percent. However, high interest rates are only part of the problem of entering into an illegal deficit. Namely, this is a category of borrowing that is reported to the Credit Bureau, which means that the client has certainly become ‘unwanted’ in the bank, because he does not pay off his borrowings regularly.
Cash credit
A cash loan is a popular type of loan, because the procedure for obtaining a loan is simple – after approval, the money is deposited in the user’s account, and the bank is not interested in what it will be borrowed for.. This is how citizens get into debt when they need a major car repair, when they organize a big celebration or want to go on vacation. Interest rates go up to 17 percent.
BONUS VIDEO:
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Source: Kurir television
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