How does the bank loan differ from other personal loans?
Bank loans do not differ much from personal loans through other lenders and alternative lenders. The main advantage of a bank loan made at your bank is that you can sign up through the online system and manage your accounts and credit all in one place.
Banks sometimes offer special advantages such as lowering fees and grouping various specific financial products and services for each customer profile.
Your bank or digital account can use your checking and savings activity to check your income and expenses and create a more favorable history or rating related to credit and limits.
Banking loan from major financial institutions
In general the bank loan in the main banks occurs in a simple, practical and satisfactory way, the rates are customizable, the conditions are also exclusive and the lines of credit usually have special conditions. In order to have privileged access it is necessary to be account holders of the institutions.
What types of loans can I get from a bank?
Banks offer a wide range of loan products to meet the majority of your clients’ needs when they need borrowed money.
Here are just a few of the loan portfolio products that you can find at a bank or financial institution:
- Secure personal loan. Usually used to finance a car or another major purchase, secured loans use this new purchase as collateral for the financing itself. The guarantee reduces the risk of default by the creditor: if you can not make payments on time, the creditor (bank or financial institution) can simply accept the newly acquired asset as payment. This reduced risk however results in lower fees and fees, but it is usually necessary to use the full amount of the loan only to finance the specified good or product.
- Unsecured personal loan. Unsecured loans offer more flexibility in the use of the money released than a secured loan, this mode does not require you to use any asset or asset as collateral. These loans have greatly increased the risk of default for a bank and creditors, usually the result are interest rates and charges with higher rates. Banks also often impose stricter eligibility criteria to approve an unsecured loan. Ex: loan with restriction; loan without consultation and loan to negativado.
- Credit line. With a line of credit, you can withdraw an amount of funds (money available) as needed. The main difference between a line of credit and a personal installment loan is that you have continuous access to a credit limit without a due date. Normally, you do not pay any fees or charges on this service until you use the money, the fees are charged only on the amount of money used and the time used.
- Payroll loan. If you need fast cash and low cost, the banks have the payroll loan mode, this modality serves both public servants and Institute of Social Security beneficiaries, in addition, employees of private companies with an agreement with the bank also have access to loans. The benefit is that you can better manage your payments, the installments are directly discounted in the bank account, the salary or pay of the applicant.
Should I get a bank loan? The pros and cons
– The convenience of keeping your loan and other financial products in one place.
– It could offer more advanced and flexible resources compared to other smaller lenders.
– If you have a current banking relationship, you can expedite the approval process.
– Approval of the loan and release of money into account is on time.
– Interest rates and fees may be higher than with other lenders.
– Strict eligibility criteria may limit people with restricted credit history.
– By the many facilities that a bank allows, it can lead the bank customer to a fast indebtedness.
– Repayment periods in installments are short term, with the exception of payroll.
What else should I consider in the bank loan?
If you are thinking of going to your current bank to make a personal loan application as it seems to be the easiest and quickest way to access cash and personal credit, consider also comparing the many online options and lending companies over the Internet.
To ensure that you get the best credit alternative, it is possible to make comparisons to see which non-bank loans you can get quickly and then choose a loan that best suits your needs.
How do I apply for a personal loan at the bank?
First, consider your bank loan options in relation to online loan options. If you have found an online lender who is interested in the offer, in general, just make the registration and access the system of the website or the application.
To get loan online securely, companies and websites provide an application form to compose the profile and plan the offer that will be sent in a few minutes.
The personal details and financial information you must submit as part of the application and registration process will depend on the lender chosen. However, online banks and correspondent banks generally require personal and financial details that include their current income, assets and debts.
To get a personal loan at any retail or private bank, you also need to be at least 18 years of age, be a Brazilian citizen or permanent resident and have a good credit score (not necessarily).
Most lenders of personal loans also require you to provide a proof of stable employment or income.
Benefits of personal loans and bank lines of credit
1. Personal Bank Loan
Personal loans provide borrowed money, ie it frees up money in advance, but stipulate a time period agreed in contract to repay the loan back, (called “loan term”).
The interest is charged to the principal amount and diluted over the entire term of the loan. In general, most personal loans involve the following resources:
- Early settlement. Once the lender approves your application and you agree to the loan agreement, you will receive all your advance funds, but you can settle the loan at any time.
- Interest rate. Your lender will charge a fixed interest rate that will not change over the term of your loan, or a variable interest rate that may rise or fall depending on the mode and market rates.
- Payment term. The period in which you will be making the repayments to pay the loan in full is called term. It usually ranges from 1 month to several years (up to 72 or more).
- Discount rates. Your lender can offer you a discount per installment in advance.
- Flexible reimbursements. Depending on your lender, you may be able to choose exactly how and when you will be making monthly payments, some banks offer up to 6 months to initiate payments.
2. Bank credit line
Lines of credit have a maximum credit limit and you only pay interest on the features you actually use. Repayments are made monthly, but there is no fixed “deadline” for returning the money from a special line of credit.
As long as you are making your monthly payments minimal, your funds will always be available to you.
- Option to increase the maximum credit limit. Your bank may provide an option to increase the maximum credit limit according to your specific needs and your bank transactions.
- Loan pre-approved. You can withdraw funds from your credit line whenever you want, as long as it does not exceed your maximum credit limit.
- No fixed payment. As long as you are always making the mandatory minimum payment or a portion of the funds withdrawn, there will always be a limit, however, interest will be levied on the remaining balance.
- Interest rate. Interest is paid monthly and charged only on the amount borrowed.
Which personal bank loan option is right for you?
Lines of credit are useful for those who need continuous sources of finance to use when they see fit. As credit lines are being used, especially the credit limit, you will not be charged for the funds you do not cash, making this a great alternative to get money funded.
Because interest rates are variable, they can be expensive on some lines of credit, however, they are suitable for people who are looking for flexibility when they need money to make purchases or start larger projects.
But in general. with free credit and an immediate source of funds at your bank, making purchases, sending payments, clearing accounts, consolidating short-term debt is much easier.
Ultimately, a personal loan is suitable for someone who wants installments in the short, medium or long term and wants an initial amount also flexible.
A personal loan is well suited for those looking to make great purchases, hold a wedding party or purchase a new car using financing.
In addition, a personal loan may be appropriate for those seeking to eliminate more expensive debt when they have a chance to get credit cheaper than a current debt.
What to keep in mind when comparing the best bank loans
Although personal loans are useful in many scenarios, it is in your interest to avoid some pitfalls and pitfalls.
Read the agreement carefully. Carefully examine all of your credit options early on and remember to look for offers with fixed interest rates, ease to make early repayment, and the cost of late payment fees. Read the loan agreement and all terms and conditions of this the first line up to the last page where you subscribe.
Make sure the lender is authorized by the BC. There are several companies, fintechs, correspondents, brokers and credit providers that operate legally, and many illegally. If you want to protect your information, it is best to do your research broadly to avoid these unscrupulous lenders coming to you.
Do not accept a loan proposal you can not afford. Just because you qualify for a large loan amount does not mean that you have to ask the bank for the maximum amount allowed.
If you only need $ 10,000 for what you want to accomplish, there is no need to get a bank loan of $ 15,000, for example, be prudent when searching for loan online or loan at your bank.