Unpredictable expenses for repairs or necessary new acquisitions pose financial problems for many citizens. Many resort to the supposedly simplest solution and open their checking account. This is possible without an application and immediately brings the required amount.
Often, the account then stays in the long-term in the red, causing immense interest costs. Some banks are getting strong on overdraft rates, so taking out a cheap small loan is clearly the better solution. Incidentally, this also applies in the event that the current account is always in the red, anyway, debt rescheduling is urgently recommended here.
Characteristics of a small loan
Small loans, with a volume of around 500 to 5000 dollars, are referred to in the banking industry as small or consumer loans. Due to the low loan amount, proof of special security is not required, a fixed income in a sufficient (attachable) amount is sufficient. Unless a negative credit entry speaks against the prospect’s creditworthiness, he can almost certainly count on the loan approval.
The intended use is irrelevant for small loans, they can freely dispose of the loan amount. Short terms and high repayment rates are typical for this financing – but not a must. If you want, you will also find a bank that is satisfied with low monthly rates and a correspondingly long term.
Small loans are granted at fixed interest rates, repayment is made through consistently high monthly installments. This gives the borrower planning security, he can calculate with a fixed monthly charge. Expensive residual debt insurance is not an issue in the area of small loans; if necessary, the bank could collect the remaining debt relatively quickly using an account attachment. With the small loan amount, the borrower does not need any additional protection.
Use credit comparison
Small loans are a variable financial product, each bank can set the conditions at its own discretion. As a result, the numerous small loan offers differ greatly from one another. For the consumer, this means that a comparison is worthwhile! The online loan comparison calculators are a good starting point for the search for the cheapest loan, they lead unerringly to the current top offers.