The decision to choose a loan is usually based on the price. There are also situations that we are not looking for the cheapest solution, but simply go to the bank whose services we always use or we have an open bank account there. Although the latter solution is slowly disappearing into the past. In this way, we usually overpay. However, neither solution is perfect.
What to consider when choosing a loan
If we take a short-term loan in the bank for a small amount, choosing the cheapest option is not bad. For this it is often enough to use a loan comparison tool available for free on the Internet. However, the choice on this basis of a long-term loan, amounting to even several hundred zlotys, is not a very good idea. Then, apart from the APRC indicator, it is good to pay also for other conditions offered by the bank in the loan agreement, as well as for types of collateral in the event of our insolvency, such as credit holidays or grace period in repayment of installments.
When we decide on a high loan, we can afford repayment of installments. Otherwise, moreover, the bank would not grant us such a loan if it decided that we do not have enough funds to pay back the commitment. However, both we and the bank make this analysis based on the current situation. We are not able to predict what will happen in a few or several years. In this case, in addition to the price of the loan, it is also worth paying attention to whether the bank has in its offer such a product as credit holidays. In the event of temporary financial problems, we can then apply to the bank for postponement of installment repayment, i.e. credit holidays. In this way, we will avoid interest on late payment. We will also have time to stabilize our financial situation, e.g. look for a new job and start earning regularly again.
We apply to the bank for a credit vacation separately. This is a product separate from the credit decision. Available to the borrower most often after 12 months of timely repayment of installments. It is also worth using credit holidays with caution, i.e. when we really need it. We cannot apply to the bank for unlimited credit holidays. Therefore, let’s do it with caution.