Posts Tagged ‘Unsecured debt’
The personal loans and credit cards are the two sources of funding that normally we come in the case of sudden encounter financial problems. Personal loans and credit cards should always be the 2 nd option. In the case of liquidity problems, always, it is best to use the money you have in the current account. If it was not the case, it would be best to hire a personal loan to use the credit card. Explain this.
Benefits of Personal Loans
- In addition, unless you hire a variable rate loan, monthly payments will be fixed over the life of the loan. Therefore, do not run the risk of accumulating more debt if you follow carefully the monthly maturities.
- Contrary to what happens to the cards, the total amount due is fixed and set to the time the loan is personal.
- Returns also facilitate the monthly fixed so you can make a coherent budget your finances. The payment is fixed and can therefore be included as such in your estimate of expenditure.
- Unlike the cards, where the debt limit can vary, in the case of loans that can not happen, so avoiding the temptation to spend more.
- Most important, however, the interest rate is much lower than the cards. They can be 2 / 3 less than the rate dela cards. All this without taking into account the card fees , also much higher than in the case of personal loans.
Interest credit card, the APR is an indicator that, as a percentage each year, shows the interest credit card or cash cost of a product. What does the APR? This includes, in addition to credit card interest, expenses and credit card fees . Thus, TAE facilitates the comparison of credit cards. Is it monthly or yearly? In many cases the interest rate on credit cards is expressed on a monthly and not annually, as opposed to what happens in the case of loans. Therefore, for comparison, multiply by 12 the monthly APR. For example, if you say you are charged an interest rate of 1, monthly, actually charge a 12% annual
Compare all offers market
This study we usually do when looking for a mortgage, however the obvious when hiring a credit card. Factors to consider To compare interest credit card, go to the APR, as it is an indicator that homogenizes all costs.
Factors to consider
The interest rate on credit cards is usually fixed but can be booked entities in the contract may be changed. The credit institution issuing the card shall inform an individual basis and with sufficient notice of any change in the interests of your card. The APR should appear in the contract and any advertising that refers to the cost. Also be included in settlement documents that the entity will periodically send
Commissions: Study the fees associated with the card. Many times behind a low APR, the encoder about abusive camisiones. Study your history credit. If you have a clean record, is in a position to ask for lower interest rates. So first find out your situation. The reverse is also true. With a poor history are unlikely to give a low interest rate.
We have already stressed how important it is, paying the amount of card debt . Is independent of the amount. If you have committed a minimum payment to make every effort to pay. Banks may change the interest whenever they want, and if they detect irregularities in the payment, they can.
Councils of the Organization of Consumers
APR to compare loans, compare loans make sure the same period. Varáin commissions according to the term. Do not compare a fixed APR of a loan with a loan interest le.En variab latter is difficult to estimate the future tae For fixed loans, always select the one with a lower APR ..
Do not compare the APR of a personal loan with another mortgage. The mortgage involves expenses not included in the calculation of APR (notaries, compulsory insurance, etc).
1. Do not take the loan funds because they want to, but if indeed there is an urgent need, such as paying hospital bills while there was no deposit in savings.
2. Do not use limited funds to purchase loan assets that depreciate, such as electronic goods. So is buying a car, vacation, and other needs that are consumptive.
3. Ensure that loan repayment funds. If there is one available funds in savings, savings first priority to pay off these bills 
before submitting the .
4. Do not “parking” loans into savings, because interest earned from savings must be much less than the mortgage interest expense to be paid. The annual interest rate is only around 8%, while mortgage interest expense KTA could reach more than 20% per year.
5. Loan Personal Loan funds may be used to cover credit card bills, provided with the assumption that the KTA is lower than the interest rates applicable credit card issuing bank. If you are still using credit cards excessively, pay bills by borrowing solution still does not provide financial security for the long term.