The author of this article works in one of the largest European banks, widely distributed in Russia. She is well acquainted with the specifics of financial services, in particular, with loans and credit cards. This article will not advertise specific companies, however, you will find useful tips that will help you determine which bank is best to take a loan from.
What is a loan? We will not turn to dictionaries and teaching aids for bank employees for a clear definition. We only note that a loan is a financial service for which you have to pay. You pay the hairdresser to give you a haircut. Pay the travel agency for the proposed vouchers and issued visas. And pay the bank for giving you money right now. Of course, you could save that money yourself. You could wait six months, a year or a couple of years. However, this is not always justified: sometimes it is better to overpay, but to get the desired thing in the very near future. For example, your TV is broken. You could save up for six months on a new TV, but it is better to take a loan from a bank and live these six months with the necessary comfort. And some areas of life - medicine, education, important events in your life - are urgent. And then you have to pay attention to the financial services market and decide in which bank it is better to take a loan.
Free cheese happens only in mousetraps. Each bank should receive profit from the loan. You must admit that not a single bank could exist if it did not receive a substantial percentage from its customers. However, not all such enterprises operate completely openly. In some cases, you may face unforeseen expenses.
How to understand which bank is better to take a loan from?
First, contact only major global banks with a solid client base. On the well-known Internet portals, you can get acquainted with the rating of banks, find out how many customers they have, how many years they have been working in the market. Reliable large facilities serve over 20 million customers. If the company has appeared on the market relatively recently - you are at great risk by issuing a loan in it. However, there are almost no differences between the two large banks with a client base of 20 and 30 million customers, look at current rates, not the bank itself. Tariffs in such institutions are constantly changing, so the company that offered the lowest rate last year, may be quite expensive taking into account the situation of the current year.
Secondly, find out if the bank charges a service fee in excess of the interest on the loan. Today this is quite rare, but be sure to check this item. Some banks withdraw money from their customers for servicing the card to which the loan was transferred. Additional funds may be required from you for insurance, for the SMS notification service, and much more. To save yourself from surprises, ask a specialist who arranges a loan, what exact amount you will have to pay, taking into account all the additional costs. An employee of a well-known bank cannot hide the truth from you.
Thirdly, find out if your rate provides for early repayment. By repaying the loan ahead of schedule, you will significantly reduce the overpayment, saving on extra interest. Always try to pay the loan ahead of schedule - in part or in full. This will be a very profitable operation for you. However, before transferring a larger amount to your account, call your bank. You may have to first write a statement to recalculate interest.
Fourth, before you get a loan from the bank, ask to calculate your overpayment. The annual interest rate does not reflect overpayment. Actual overpayment is calculated at a compound interest. A rate of 70% per annum may lead to an overpayment of 20-50%, depending on the amount and term of the loan. When entering a financial enterprise, do not rush into the statement “I want to take a loan from a bank”, ask in more detail about current rates, monthly payments and the necessary package of documents. Most banks can get a loan according to two main documents, but with a maximum interest rate. When determining which bank is better to take a loan from, do not forget to take a 2NDFL certificate at work and a certified copy of the work book — this will help you reduce costs. Be careful and carefully choose a bank, then you can protect yourself from all sorts of troubles.