Consumer loans: are they really beneficial?

Consumer loans are offered by all financial institutions. Discover their advantages and disadvantages before you start on a project.

A consumer loan is the ideal solution for those who cannot afford to save and want to complete a project such as buying a car or household appliances. The consumer loan can be assigned to a specific purchase or it can be unrelated: that is to say that the amount borrowed can be used for any acquisition.
Here are some examples of consumer loans: auto loan, travel loan, personal loan, renewable loan.

By contracting this type of loan, the subscriber retains many advantages: the total amount allocated by the financial institution allows the subscriber to make a single payment for the good he wishes to acquire and then to repay gradually depending on the payment option chosen.
Then, with an unrelated loan like that of the loan reserve, the subscriber can still pleasurably carry out monthly payments. For example, if a person purchases a car loan to buy a new car, he can simultaneously opt for a renewable loan in order to maintain the his style of living during the reimbursement period.
If he has already committed to another loan (home or work), he can purchase a loan, to pay only one monthly payment and receive a discount of up to 60% of the monthly payment.

If, for some reason, the subscriber cannot pay, there are solutions such as: requesting additional time by mutual agreement or through the use of a district judge. If these alternatives are not acceptable, the last option is to request the services of a debt collection company. The latter choice can be expensive and the subscriber must be careful not to become over-indebted.
The consumer loan is also beneficial to economic growth because it encourages consumption by increasing the purchasing power of customers. But, as with everything, there are drawbacks to consider before committing. The first compares the high interest rates as compared to market rates: the longer the repayment period, the higher the monthly rate becomes (from 3.90% to more than 20%).
Consumer loans, particularly reserve money, are deemed to be the cause of over-indebtedness of individuals who have not mastered their new purchasing power. In fact, when the subscriber spends more than he should, he can no longer fill his dues and becomes further entrenched in debt.

In most cases, advertisements do not mention hidden fees with the intent of attracting more customers. These customers subscribe only to find themselves faced with more expensive rates.

Before you start, carefully check each clause of the contract to avoid inconvenience, discomfort and unexpected expenses. Enlist the services of a professional at to find an offer that fits your profile.

Audrey Benzaquen

Par , le Tuesday 5 February 2013

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