Cash loans – How good are they?

Rate this post Not all credits are obtained at the bank. Did you know? There are so-called cash credits that if bine can get you out of trouble, they can also sink your finances. Let’s find out more about them!

What are cash credits?

The so-called “cash credits” are loans made by family, friends, usurers, pawn shops or banks and that generally refer to “smaller” amounts, of between 200 or 800 thousand pesos maximum; in this regard each bank sets its limit, and each relative or friend too! As examples we can mention that the Best bank considers 280 thousand pesos as a maximum limit, Good Bank 500 thousand pesos, and South Bank 750 thousand pesos.

Regarding the use of the loan, we can imagine that the conjugal situation of each person is central, since the responsibility – and “lifestyle” of the single person is different from that of the married person. In other words, the married person will surely use the funds to attend matters of children or wife, to buy furniture or household appliances, pay tuition or buy books and notebooks, etc.

The priority of the single person is possibly to buy new clothes, travel or equip his car with a special engine … in fact, everyone would merit a special analysis for a lender.

Cash credit requirements with a financial institution

Regardless of the limit set by a financial institution, we must mention that the usual requirements are:

  • A permanent job
  • Proof of income
  • One year in the current job
  • Good credit history

The amount of the credit in cash will also depend on the monthly income, and it can be mentioned that the bank analyzes each case “on its own merits”. Possibly relatives and friends ask for less requirements but the “loyalty or sentimental moorings” are greater. Regarding usurers … there are no clear rules as we know, and it is not the credit that a finance expert would recommend.

Finally we can add that before receiving the loan the interested party must always consider whether the interest rate is fixed or not, and if it is not, comment and study the corresponding risks very well! Second, the interested party should analyze whether the term is reasonable or sufficient to pay and meet it without problems, and thirdly make some calculations with the Total Annual Cost (CAT) of the bank itself to understand the amount of the agreed payments (monthly, quarterly, semiannually or annual).

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