4 tips on how to choose the best loan before Christmas

January 19, 2020 by No Comments

Take advantage of the pre-Christmas events of banks and credit companies Many banking institutions are preparing more advantageous credit offers before Christmas. For example, Česká spořitelna has also prepared a special loan offer for its clients by the end of the year, which will forgive up to 12 monthly installments. The condition is that the clients repay properly.

Even the non-banking companies Cetelem and Home Credit are not left behind with special offers. Customers who purchase some goods through hire purchase directly at the outlets provide so-called loans without any increase, ie loans with zero interest. This event can be used in IKEA, DNAAP.com, Mall.cz and weekends in Elektro Expert.

2. Compare bids on the Internet first

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The easiest way to choose the best loan is to compare offers in the online calculator. Offers from most providers on the market are compared for example, online comparer Compare.com. Just enter the amount you want to borrow and how long you want to repay it. In just a few minutes you will find out what provider is offering you the loan with the lowest interest right now. You can then arrange the loan online.

The advantage can be demonstrated by way of example. If the family wants to borrow USD 20,000 with a maturity of 24 months, it will pay USD 1,656 per month for the most expensive offer and will pay a total of USD 39,744. On the other hand, for the most advantageous offer, their monthly payment will be USD 898 and will pay a total of USD 21,552. In this example, careful selection of the provider can save $ 699! The difference in monthly payment is USD 758.

3. When selecting, do not only monitor the interest rate, but also other loan parameters

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With the financial literacy of Czechs, this is no glory. It is no wonder that when people are interested in the terms of a given service and try to compare products, they often observe bad parameters. A typical mistake is tracking interest rates only. However, this figure does not include fees and thus the total cost of the operation. It is much more important to monitor the annual percentage rate of charge (APR) instead of interest.

4. Combine several contracts into one or try to refinance the loan

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Once you have chosen the loan honestly, you may not know exactly how much you are paying in a month, how much you have already repaid or how much you owe in a few months. Indeed, this experience stems from STEM / MARK surveys. You will simply be glad that the matter no longer needs to be addressed.

However, it is useful not to forget that the financial market is also evolving. Therefore, always remember the possibility of refinancing, ie the possibility to move the obligation somewhere else, where you get more favorable terms, or to merge several contracts into one if you are in such a situation. It is necessary to make the most of the competition on the market.