Everyone has sometimes borrowed private money. As a child you asked your sister for money for noses. Your friends paid your beers until you had Sunday pennies again. And your parents gave you a hand if you could not pay the rent for your room. But when it comes to larger amounts, it can also cause family problems (and embarrassment). That is why when we reach the age of majority we usually go to a bank or – increasingly often – a lender for a loan. Private lenders have sprung up like mushrooms in recent years. But is borrowing private money actually a good idea?
Borrowing private money
Most lenders can certainly be trusted, but spend some time in the financier. Check his license, view consumer websites, and read the comments of other borrowers and the loan contract carefully. It is also important to know that a provider may never request closing costs; it could just be that you will never hear anything again once you have paid. An advantage of borrowing private money is that a private lender is ideally suited to smaller loans. Your washing machine breaks down? Your friends already see you coming with your laundry.
You can request a loan online and smaller amounts (mini loans or micro credits) are often in your account after 24 hours. Disadvantages of this type of credit are the often less favorable conditions and higher interest rate, because and no income or CPK checks (Central for Credits to Individuals) are carried out. Do you have a negative CPK registration? Then the bank often keeps its hand on the bill, but for a private lender there is often no hindrance to grant you a loan. If you are unemployed, you do not have to go to the bank. But there is always a private lender somewhere where you can get a loan; often under the condition that, for example, you have a partner with a fixed income. And it is always important not to borrow more than what you can pay monthly.
To repair or buy a house, a bank loan is taken out more often, because banks usually offer longer installments than private lenders. And with large loan amounts, many people still fear a relatively new credit concept; a bank is then familiar territory. Borrowing money always costs money, but it is now easier than ever to find out quickly what you are going to pay per month. Whether it’s a private loan or a bank loan, Belgian credit law requires that the annual percentage rate (APR) must always be clearly stated.
The APR indicates the total costs per year, so the interest and the borrowing costs. Most banks and lenders have an online loan simulator that you can use to calculate the repayment of your personal loan for free. This way you can quickly search and compare a large number of credit institutions, set the best rates and choose the cheapest lender. The lowest APR means more money in your pocket for that pint.