A personal loan is a suitable form of borrowing money for people who are looking for security. With a personal loan you choose a loan with a fixed interest and a fixed term. You therefore know in advance how long you are “attached” to the loan. This is nice if you take out a loan.
|Personal loan||Revolving credit||Mini loan|
|From 4.1%||From 4.5%||Borrow a maximum of $ 1500|
|Fixed interest||variable interest||No BKR testing|
|from 21 to 69 years old||from 21 to 69 years old||from 21 to 70 years old|
|Payment within 2 days||Payment within 2 days||Payment within 24 hours|
|Apply for a personal loan||Apply for revolving credit||Apply for a mini loan|
Benefits of a personal loan
As already indicated in the first sentence, the most important advantage of borrowing money in the form of a personal loan is security. You know in advance how long your loan will last, and what you will have to pay in total for the loan.
This gives you all the security you could wish for.
Another additional advantage is that the loan can now also be repaid fine-free with almost all providers. This was different in the past, if you still have an “old” personal loan, it is wise to look at this before you start paying off your loan.
Borrowing money in the form of a personal loan can also provide you with additional benefits. But only if you are going to use the loan for home improvement, actually a kind of renovation loan. If you do this, you can in many cases settle the interest with your income tax. This can save you up to about 50% of the interest you pay. Definitely something to take into account.
Disadvantages of a personal loan
In addition to advantages, a personal loan also has disadvantages. Although this has all gotten a lot better with the omission of the penalty interest at most providers.
The only drawback of the personal loan is that if you have just applied for a shortfall, you have to apply for a loan again. Unlike the revolving credit, you have no money to spare. This may therefore mean that you have to apply for a new loan again. With the accompanying paperwork.
Personal loan and the BKR
A personal loan is a form of credit that will be registered with the BKR by all lenders. Rightly so. Borrowing money without BKR testing is therefore not possible with a personal loan. In the case of the personal loan, unlike the revolving credit, the net amount (the amount that you have borrowed) is not stated on the BKR. But the amount including all interest to be paid by you in the term.
For example, if you take out a loan of $ 10,000 and you have to pay $ 2,000 in interest during the term, the loan will be registered with a revolving credit for $ 10,000, but with a personal loan for $ 12,000. In itself not a disaster, of course, but something you should know in advance. A good credit advisor will also draw your attention to this before taking out the loan.
Is a personal loan cheap to borrow money?
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Whether a personal loan is cheap money borrowing depends on a number of factors. It is true that a personal loan is slightly more expensive in terms of interest than a revolving credit. With a personal loan, the bank has to buy the money for a longer period. This is not the case with revolving credit. A personal loan will therefore always have a slightly higher interest rate.