8 questions to ask before you take a loan
This spins the wheel of the debt spiral . If you had a problem repaying your first loan, it is more than likely that you will have a problem when the next non-bank loan comes in. Sanctions, penalties, fees…
1. I do not want to repay another loan with a loan?
Tip: The responsible provider will not approve your next loan until you pay the first loan. It’s a risk for him and for you. However, it can offer you consolidation instead of another loan .
2. Are I in danger of seizure?
If you are in danger of being executed , you are probably already in a debt trap. In this case, the same rules apply as in the previous point. While many companies offer a loan directly to pay distraint , the problem is only delayed.
Tip: An imminent execution should be a clear sign that the loan is no longer the way through loans. Definitely contact the lender or one of the civic or credit counselors as soon as possible and start resolving your situation. Another non-bank loan is not the right option.
3. Do I want to borrow for the necessary thing?
When a car, fridge or stove is broken, it is necessary to solve the situation immediately and a non-bank loan makes sense . But less needed is the TV or the latest phone model when your phone is still in use. We definitely do not recommend borrowing for gifts, weddings or holidays.
Tip: Our Ombudsman has a simple rule that says that the lifetime of the purchased product must always be longer than the length of the loan. It pays to drive it!
4. Is the lender reliable?
There are many predators in the lending market, who only care for the fat booty . So, before you take a loan from someone, take a good look at their terms and find the references of people who have borrowed before you. Ask your friends.
5. Do I have a permanent income?
Without a permanent income, you probably will not repay the loan. If you live in a couple where only one partner earns, don’t overdo it with the loan amount . Anything can happen and it is hard to tighten everything from one salary.
Tip: Calculate your monthly earnings and expenses thoroughly and borrow only as much as you can repay at all times.
6. Not taking a loan for a friend or other acquaintance?
No matter how good a friend is, borrowing money for him is not only a big risk, but also a crime. In the extreme case, the execution will affect you and your property and you will lose much more than just a friend. In addition, you will already have an entry in the bank register and yourself, if necessary, you will get worse loan.
Tip: To help a friend in a difficult situation, invite him or her to eat or help him find a job. You can also borrow it from your budget if it doesn’t burden your budget. But a non-bank loan is not a solution.
7. Do I know how much I really pay for a loan at the end?
Don’t be tempted by ads and study the terms carefully . This is the only way to avoid the unpleasant surprise that a five thousand non-bank loan has almost doubled you. Don’t miss the paragraph on penalties for late payment . These can go to thousands more crowns.
8. Do I understand the terms and conditions?
Complex wording and deliberate omission of some information. Even such things can be found in contracts. Therefore, always take enough time to study and if you do not understand something, ask .
Tip: Pay particular attention to the general wording such as “the lender may claim all recovery costs.‟ The provider may hide a number of fees under them.