Best bank has published a handbook of interesting things to know when it comes to payday loans. Let’s go through the various points and give our opinion to better understand what to do and what to evaluate when applying for a payday loan, to be ready and be able to get the loan.
Here are the 10 things to know about payday loans according to Best bank
The first question to ask is “what is a payday loan “. Basically, it is a loan that is requested by those who need money to purchase any object / service. The sum of money is returned by paying monthly installments (usually fixed) which also include a certain interest rate, which is also fixed.
What are the basic requirements for having a payday loan?
The first basic requirement is to have a job, subordinate ( employee loans ) or self-employed ( loans for self-employed ). Depending on the type of financing you want to obtain, you can also apply for a fixed-term loan. In addition, you usually need to be aged between 18 and 70.
Loan declined, when does it happen?
Loan rejection usually occurs when the bank or finance company believes that the applicant is unable to repay the loan easily. Another reason for refusal could be to be bad payers or protests.
What to do before applying for a payday loan?
The best thing is certainly to access different offers of loans and loans, so you can choose the most suitable quote for your needs. In this case, an online loan application may be ideal.
What are the details of a payday loan contract?
Mandatory, a payday loan agreement must contain at least the following details:
- sum paid and method of delivery
- interest rate, TAN and APR
- loan costs and fees
- other costs that must be paid, such as the preliminary costs, the cost of sending the periodic report, any insurance costs, costs related to late payments, etc.
- amount of each installment and maturity of each of them
- any guarantees required
- if loan insurance is also required
What is the APR?
APR stands for Global Effective Annual Rate and consists of the cost that a user will actually have to bear in repaying a loan. In addition to the interest cost, it also includes that relating to other expenses, such as preliminary costs.
What happens if you don’t pay installments or pay late?
In this case, you may incur default interest and reporting as a bad payer. If you are unable to repay installments, the best thing to do is to contact the bank or finance company to find a solution together.
Withdrawal of a payday loan, can it be done?
Absolutely yes, the statutory deadline is 14 days from the signing of the contract.
Early repayment of a payday loan, can it be done?
Also in this case the answer is positive, but it is necessary to pay attention to the fact that banks and credit institutions often apply penalties that must be paid and that are calculated as a percentage of the residual sum. Here, therefore, that, after a certain period from the beginning of the contract, it would no longer be appropriate to extinguish it in advance because the cost of the penalty would be greater than that of the interest to be reimbursed.