Would you like to take out a loan but not pay it off forever? Do you want your loan to save interest without looking at how the repayment limits your liquidity each month?
A loan with small installments, planned seriously and financed at low interest protects the household budget. It offers enormous interest savings compared to other popular financing and can still be repaid quickly.
We will show you how it works, why you can safely do away with residual debt insurance (RSV).
Small installment loan – interest saving model
In our increasingly cashless world, the digital wallet determines shopping behavior. The example of Sweden shows what the future of digital payments will look like. The first Swedish churches have even switched to electronic payments for donation in the bell bag. Everyone can confirm from their own experience how quickly the overview is lost when paying by card. The checking account compensates for the small inadequacy. Studies show that people who use their overdraft facility push an average overdraft of around 3,000 USD in front of them.
A loan with small installments offers the opportunity to put the expensive overdraft interest in its place. The interest rate example of the Sparkasse shows how expensive the overdraft facility is. In the March 2016 accounts, a Lippische Sparkasse reported 16.88 percent for overdrafting. At 3,000 USD in the red, the overdraft facility costs around 500 USD a year. The installment loan from the loan comparison becomes the interest-saving model. Overdraft rescheduling into a small loan with small installments only costs around USD 31 per year.
The loan would be repayable in small installments of just USD 85.89 per month. Bargain hunters who include your overdraft interest (USD 41.66 / month) will discover the installment loan as an optimal interest-saving model. But small installments are not only worthwhile for saving interest on small loans. It becomes really interesting when large loan requests are met in small installments.
Small installments instead of residual debt insurance – insurance savings model
Completing a large financing with small installments is not only easy on the household budget. With large sums of funding, it is important to plan future-proof financing models, because nobody can predict what will be in five years’ time. The desire for protection against life risks, such as illness, unemployment or death, brings insurance on the scene. Virtually any loan can be taken out by a healthy, fully working borrower along with residual debt insurance.
The costs for the RSV are only recorded in the effective interest rate if the conclusion would be made mandatory. Many do not know how expensive their credit insurance really is, what real risks it excludes. Borrowers usually find out very late that the RSV is not calculated back in the event of early loan repayment, for example through debt rescheduling. About 20 percent of the loan amount corresponds to the insurance contributions of an average RSV. Only a few contracts cover the greatest risk if the installment payments can no longer be made – ALG2.
It would make more sense than the RSV to take out a large loan with small installments. Small installments make it possible to meet the payment obligations even in the event of unemployment (ALG1) and sickness benefit. In comparison to credit insurance, only the risk of death would be uninsured. Nevertheless, nobody wants to pay back longer than necessary. Instead of paying 20 percent more for RSV, the money is transferred to a savings account every month.
Quick repayment despite small installments
Paying attention to the right to unlimited free special repayment when taking out a loan pays off when the savings amount has grown. It is used for special repayment and automatically shortens the remaining term.
Nonetheless, the security of being able to pay the installments securely even in bad times is maintained throughout. In the event of unemployment or illness, there would simply be no money flowing into the savings book for a while.
A loan with small installments, which is saved, offers at the same time preventive protection in the event of unexpected credit requirements due to the savings amount. Instead of the special repayment, for example, the car repair would then be paid.
Loans at low rates – discover loan offers
For the search for the installment loan with small installments, loan comparisons are the best address. Interested parties enter the required loan amount, term and purpose of use in the loan comparison calculator. Nevertheless, it does not pay off for many prospective customers to apply for consumer credit over 60 months. From around 60 months onwards, the required interest rates skyrocket.
If you are looking for a loan with small installments, since liquidity and creditworthiness are somewhat restricted, private loan offers become interesting. Credit seekers can find the best address for the loan application from the market leaders. Good Finance and Best Lender meet borrowers and lenders in a serious atmosphere. Neither financiers nor borrowers have to expect unfair credit brokering methods or unclear cost traps.
No portal can guarantee private lending. However, free loan attempts and the best possible support for the portals are guaranteed to create the necessary banners for the loan. Transparency by activating the certificates offered free of charge creates the necessary trust for capital investments. A loan with small installments from private is approved as soon as sufficient bids for financing have been submitted and accepted by the borrower.