Looking at the types of loans available in both bank and non-bank lenders, it is clear that different types of credit are appropriate for different situations. Understandably, mortgage and student loans are given for a specific purpose, but what kind of credit to choose for more everyday expenses? Find out in our expert article on what to look for when choosing a lender and a loan!
3 types of loans for different life situations
Each of us wants to be independent and plan our own finances, doesn’t he? Therefore, there are three types of credit for which no specific reason for borrowing is given:
- fast credit;
- consumer credit;
- credit line.
Each one varies in volume, maturity, and interest rates, so it can be more or less advantageous in different situations:
- Fast credit online is a small loan with a maturity of one week to a few months. This credit can be obtained by applying online. You need to log in to the lender’s website and create your own profile, and further specialists organize the necessary processes to secure the loan. Loans on the Internet must be repaid within the deadline set by the lender, but the repayment thresholds for creditors may vary. This cash credit is suitable for unexpected and urgent expenses such as medical procedures, vehicle repairs and other purposes;
- A consumer credit is a long-term loan of up to several thousand euros with a maturity of several years. Credit is offered by both banks and non-bank lenders. This is a good credit in situations where planned expenses are clearly higher than your daily expenses, such as purchasing household appliances. Therefore, the purpose of this loan is similar to the use of leasing. A consumer credit ensures that the customer immediately acquires the desired product by borrowing a certain amount of money in advance and repaying it over time.
- A credit line is a cash credit on the Internet that adapts to each customer’s situation. The customer determines the required amount of money at a particular moment. Its advantage is to avoid overpaying interest on a portion of the loan that the borrower does not use – you are granted a line of credit that you can spend as you need, but the interest rate is only calculated on the amount of money that you will spend on the principal. This is a good credit at times when it is difficult to predict the final amount of payments to be made, such as when starting a home improvement project.
Which loan is best for you?
The best and most effective way for you to find out and find out which credit is best for you online is to ask yourself the following questions:
- What is the time frame for which you would like to make credit payments?
- What is the approximate amount of money you can afford each month to repay the loan?
- Which payment method would be most suitable for you?
- Are there any changes in the circumstances surrounding the loan repayment period and can this affect your ability to repay the loan?
Once you have considered which type of credit to use, the next step is to choose a lender and study the application process.
Online Loan – Borrow at a convenient place and time
Are you currently abroad or out of town? Or maybe you are constantly on a squirrel wheel when you often don’t even have time for a quiet morning aromatic coffee?
Quick short term credit as well as a line of credit is available on the internet and there are several lenders who offer online consumer loan as well, which is a convenient solution for those in a hurry. Dora Spenlow is one of them, and our specialists invite you to visit the website to read the terms and conditions of the contract and to evaluate your ability to repay the loan.
Loans on the Internet are a popular choice because they have several advantages in terms of functionality:
- You don’t have to go to the lender to apply for a loan – you can apply for a loan from anywhere in the world with an internet connection;
- Your application is processed relatively quickly if you apply during the lender’s employment and meet all the conditions. An advantageous credit on the internet is definitely one that offers you to make transfers from major Latvian banks – both receiving and repaying money is done in just a few minutes, provided that you and your lender account are maintained by one bank;
- Loans on the Internet are granted without collateral or guarantors , but lenders, including Dora Spenlow, will seriously check your income for the loan.
Although it is easier to get a loan on the Internet, it should not be forgotten that it is not easier to get a loan – it takes just as much consideration of applications and customer compliance. How to? Read on!
Rest assured of your ability to repay your loan!
Once you have found a suitable and beneficial loan on the internet, you should make sure that all of the lender’s terms are understandable. If you are reviewing multiple lenders, do not expect the same types of loans to have the same terms – yes, the terms of each lender may differ even in the slightest nuances.
Dora Spenlow’s key terms for clients are :
- You must be a Latvian citizen between the ages of 20 and 75, but the age limits for each lender vary;
- Your income should be regular and in line with your desired loan amount – optimally that the monthly installments of your loan do not exceed 30% of your income;
- There should be no outstanding transactions in your credit history – any negative credit history in the past can be considered as a reason for rejecting an application;
- You will need an account with an active internet bank at one of the banks operating in Latvia.
Once you have considered your compliance with the lender’s terms, the last points to focus on are the lender’s credibility.
How to make sure the quality of service of the lender you choose?
When using a lender’s online credit services for the first time, it can be difficult to determine whether the lender in question will provide easy communication, secure transfers, and quick action throughout the cooperation period.
Pay attention to the lender’s website
You will have access to an advantageous credit on the Internet in an easy-to-understand and easy-to-use website, since everything from signing the contract to repaying the credit will be done right there.
As online credit does not provide direct contact with the lender, Dora Spenlow experts believe that the most important step before applying is to verify the lender’s credibility and professionalism. The best way to do this is:
- See if it is possible to contact the lender’s client advisors and definitely do so if you have any credit questions;
- Read previous customer reviews;
- Verify that, like Dora Spenlow, the lender is a member of the Latvian Alternative Financial Services Association.
Tips to follow before you take out a loan
- Identification of tenders. Taking a step closer to getting a loan, it would be a wise decision to thoroughly familiarize yourself with the current market situation by carefully examining offers. Credit is a contractual obligation, so it is better to look carefully at both the terms and the types of credit to choose the one that suits you best and that you will not have to overpay for later.
- Family budget planning. Credit will not solve your financial situation in the long run, so before you take it, develop your family budget and be sure that you can afford the monthly payments. Creating a family budget will also allow you to spend more money and pay your bills, thus understanding whether you are spending too much and whether you can save money on the internet without the need.
- Identification of threats. It is not wise to borrow to pay off an existing debt. An additional online loan to pay off a friend’s debt might seem like a good idea to get the cash loan back without a hitch without affecting your friends’ relationship. However, a better option is to talk openly with a friend about extending your repayment term or agreeing to pay off at least part of your loan each month. A loan from a non-bank creditor is not intended to offset other debts. This can lead to more serious financial problems in the long run.
A reliable lender and a good loan for you are definitely not far away, but any loan is a serious decision to make, so take the time to research! Before applying for a loan, read the terms of the contract and borrow responsibly, carefully assessing your chances to repay the loan!