Mistakes not to make when you take out a personal loan
You want to finance a personal project with a loan? Do you want to take out a loan? This article summarizes in 5 points what you must absolutely consider. 5 useful tips to choose the loan that will be perfectly suited to your profile and your needs. Click here for Persoanl Loan.
Do not leave the margin at the budget level
When you have a project and want to make a loan to finance it, it is very important to first assess your borrowing capacity. That is to say, your ability to repay it without difficulty, even in the event of unforeseen circumstances. Visit https://EasyCredit.com.sg to get personal loan.
For this, you can start from a simple calculation. It consists of adding your monthly income and subtracting your monthly expenses, including the amount of the refund of the new credit you wish to contract.
Monthly income – monthly expenses * = rest to live
* including the repayment of the new credit.
Then you have to compare the result of this subtraction so-called “rest to live” with the sum of your monthly income. Generally, it is considered that the remaining living must be at least 30% of monthly income for a single person and 50% for a couple.
This calculation will also allow you to estimate the ideal duration for your credit. Indeed, extending its duration will allow you to reduce the monthly repayment so that it fits your budget. Attention, however, that maximum periods are fixed by the regulation according to the amount borrowed.
Do not compare
There are many loan offers, so it’s important to compare and evaluate the offer that’s right for you. To compare, always leave the apr (annual percentage rate). This is an “all inclusive” rate that allows you to effectively compare all offers of personal credit, regardless of their formula.
Do not read the terms and conditions
Although the regulations strictly and precisely regulate consumer loan, it is absolutely necessary to read the general terms and conditions of the contract. These must be provided to you through the credit intermediary or the lender.
You will discover, for example:
- That you still have the right to waive your credit within 14 days of its conclusion
- That you can also repay in advance in whole or in part at any time
- Late fees are capped by regulation.
Do not consider the possibility of grouping your loan
If you already have loans in progress, it may be interesting, as part of a new credit application, to study the possibility of consolidating all of your loans.
A pool of loans is to gather 2 or more credits in one.
A credit consolidation can allow you either to obtain better rate conditions on the new loan pooling existing ones, or to modify the conditions of your existing credits.
For example, you have two loans over 36 months. You want to make a new loan and consolidate the whole with a repayment of a longer duration. The final cost will be higher, but the proportional reduction in the monthly payment obtained through consolidation will allow you to manage your monthly budget more easily.