Many people think of a credit as if it were free money, forgetting that a bank is not the sister of charity that procures those who have less. The credit is a financial service that has a specific cost that must be paid by whoever hires him: the interest rate.
The foregoing expresses that there is a certain fear of suffering from the cloning of cards, unrecognized charges or identity thefts that directly affect the economy.
What many do not know is that it is increasingly safe to make these types of transactions, because companies have security filters that avoid any financial damage to their customers.
Unfortunately, this fear has prevented us from taking advantage of the advantages of shopping through the Internet, which we will list below:
Offers: some stores have discounts and promotions if you buy online, which is a relief to your pocket because you can get offers quickly and conveniently from your home.
In addition, you can register your email to be notified at the exact time when a product or service has dropped in price.
The loan is an unsecured loan granted by a bank or financial entity in order to gather the necessary liquidity to carry out a transaction.
A loan of this type allows you to buy goods and services in the present to pay for it in the future. Of course, all this comes with a fee that you must cover for hiring a money advance service.
If you are smart, you will pay the full balance when you have to do it and you will use the bank’s money with intelligence, thus avoiding an over-indebtedness or a complicated situation in which you can not fulfill your financial commitments.
Those who do not pay the bill in full every month and make additional purchases are soon overwhelmed by interest payments, resulting in a growing balance.
This is toxic to your financial health and may affect your credit rating.
A credit offers the convenience of increasing your purchasing power. A loan will facilitate the realization of transactions for large amounts that exceed your monthly income, but that you can afford for a longer period of time.
This way you can carry out projects that you have in mind such as traveling, buying a car or remodeling your house. The banking and financial entities have done a lousy job of promoting credits as status symbols and tickets to freedom when in fact they are a service that should be used with prudence.
To use a credit in your favor you have to know what are the conditions of contracting and the obligations that you acquire. This way you can pay on time, pay the lower interest amount and settle your debt properly.
Before hiring a loan, check the terms and conditions that will determine the total cost of the service.
You should be crazy to accept a loan without knowing what the interest rate will be, the period contracted, the corresponding commissions for the service and the penalties that you could suffer if you do not comply with the payments.
When you’re going to take out a loan, make sure you know what the interest rate you’ll have to cover. This rate is a percentage that is charged on the total amount owed, so the monthly interest should be reduced as you pay for the loan you requested.
Some banking and financial institutions offer a fixed rate, but there are others that can offer you the hiring of a variable rate. The fixed rate may be more convenient because it will let you know exactly what percentage you will have to pay for interest.
The variable rate can be a double-edged sword, if the reference rates in the markets fall, you will benefit with a lower rate, if they go up, you will be harmed because you will have to pay more for the loan.
Some banking and financial entities offer variable rates linked to interest rates or other indicators of the economy. This is not always a problem. However, being on the side of these data can be complicated.
Unless you are an economist dedicated to these issues, it is best to ask for a fixed rate. The interest rate can become a headache if you do not make sure you pay on time for the credit you have hired.
If you stop paying, the original owed amount will still be there, but what you will have to pay for interests that will grow like foam. A smart credit user pays the bill in full every month to only pay for the service contract.
When you are going to take out a loan, make sure you have available each month the amount of money you will need to pay your credit and the corresponding interest. When you are hiring, ask how much you will have to pay per month.
Think about your regular monthly expenses. If you have the amount you need and a little more, you can apply to get out of payday loan. Try to keep monthly payments at the lowest possible level. Some experts recommend that you pay no more than 30% of your monthly salary to pay for a loan service.
If you exceed this limit, it is likely that in a month you can not comply. Extraordinary expenses could severely affect you if you have to use half of your income to pay off the loan.
Make sure you pay the amount owed or a little more each month. Never pay the minimum or stop paying, this would generate penalties that will increase the amount of your debt. This will allow you to save money because there will be no surcharges, extra commissions or increasing interest.
A good payment history of the credits you have requested throughout your life is recorded in the credit bureau. The better your history is, the better financing options you can find.
Remember to keep the documents of the contracting of your credit and the contact information of the institution that you have hired at hand. This way you can solve any doubt that may arise about the loan services you have requested.
A regular review of your credit history is vital to maintaining a solid credit rating and protecting yourself against identity theft.
Generally, the credit history contains personal identification information, a credit summary, account history, inquiries, collections, and public records.
All this is what the financial services providers consult in the credit bureau to know if you are a risk or if you are able to contract loans.
Your credit history contains all the information about the payments you have made and those you have not made, the debts you have contracted, the credit periods you have hired and the types of credits you have used.
Here are six basic points so you know how to use a credit in your favor:
1. Terms and conditions: review in depth what you are obligated to when you hire a loan.
2. Receipts: save the generated receipts and all the information about the payments you have made. This will make it easier to make any clarification. You can use your account statement to collate the information and know what the monthly status of your credit is. If you notice any irregularity, go immediately to check if there is any problem.
3. Regular payments: before hiring, prepare a plan to pay the full balance each month. If you realize that you can not cover the monthly payments and keep some extra money, it is not a good idea to hire that credit. You can request a lower amount that suits your possibilities.
4. Avoid charges for late payments: always make the payment before the due date to avoid late fees.
5. Routine purchases: do not use your credit money to buy things that you do not even need to make routine purchases. Use the credit for what you hired: start a business, buy a car, improve your house, etc.
6. Protect your information: do not share your credit information with any person who calls you on the pretext of “verifying” your personal information or “correcting” a problem. For sure, it’s a scam.
We invite you to download our study “The financial advantages of a credit”, we will tell you how and why a financial service of this type can be an excellent option to fulfill your dreams.