Going for a bank loan is quite common today. Among other things, because in the past there was basically no other option. Bank loans today have a number of advantages as well as a number of disadvantages. Are you interested in specific ones? Let’s look at them. And let’s start with the benefits of bank loans. An editorial over at hocketoanhn.net
Loans you can’t find anywhere else
We have to say that the big positive is that you will find such loans that you cannot get elsewhere. You will not find them either with non-banking companies or in the popular P2P segment. This means that banks are a bit ahead in this respect. What are the loans you can only ask for them? These three are:
- Building savings loan
- Bank mortgage
Certainty of fairness
Obtaining a banking license is not easy. And once it is acquired, it certainly does not mean that the bank can do whatever it likes. During its operation, it is under constant control, not only by the CNB. This logically means that you can expect fair access at all times to the bank. While there may often be various frauds in the banking segment, in this case you can be sure that they will not appear here. This is simply because they would be exposed immediately.
Favorable interest rates
If we are to look at profitability, we also have to make it clear that in this respect you will certainly be pleased by the bank. While some may have higher rates, there is no problem finding those that are among the most advantageous on the market. If you are looking for advice on how to find such, we recommend you try rather smaller banks. Not only do they generally have lower costs that they can translate into their interest rates. These can start at units of percent.
Money immediately on your bank account
This is one of the advantages that we must not forget at banks. If the segment of loans is clearly dominant, then it is non-cash loans. Those that are paid into a bank account. For non-banking companies, there is a risk that money may go up to several days due to weekends and public holidays. It is certain that banks will be credited immediately. This is because you can apply to your bank for which you have an account. And transfers within the same bank are made 24 hours a day, 365 days a week in a matter of seconds. Once the money is in the account, you can:
- Transfer to another account
- Withdrawal from ATM or branch
- Payment by credit card
Good availability of branches
While we are living at a time when many things can be solved online, it should be added that there are cases where you cannot do without visiting a branch. Here, banks have the advantage of having a fairly good network of branches. And mainly the largest banks in our market. Their branches can also be found in smaller towns. This eliminates the problems of, for example, complicated travel to the nearest big city.
The bank’s clients have a pre-approved loan
The last of the benefits that bank loans bring is for the clients of the bank. They have the advantage that they can already have a specific loan pre-approved based on their account turnover. In practice, this means certainty that the loan can only be approved in the context of internet banking and can be immediately credited to the bank account. This ends our review of positives. Let’s see what can be disadvantageous with banks.
Mandatory arrangement of other services
Unfortunately, this is one of the frequent negatives that bank loans have. If you are not a bank client, one of the mandatory services may be to open a bank account. This will give you the advantage of receiving your money immediately, but don’t forget that not every bank has an advantageous account. Some still have different charges. Only because of the loan you can pay a considerable amount per month. This is certainly no positive.
More complex scans
The low interest rate must also be reflected in the fact that the bank wants to eliminate those clients that may be associated with a certain risk. How is he doing? It has a clear approval process. And it is quite strict at the bank. If you are a loan applicant, the more complex screening itself is based on the fact that the money is intended only for creditworthy clients. Those who meet the main three conditions:
- Sufficient income
- Minimum monthly expenditure
- Good financial history
Anyone who has a problem with any of this should worry that there may be two things. The worse is the rejection of loan applications. The better thing is to change the interest rate. And this is the negative we will look at right now.
The interest rate given may not always be realistic
If banks are intrigued by the benefits they can offer, it should be remembered that they may not always be sure that you will be able to achieve such an interest rate. It is one that is intended not only for the best clients, but also one that is available only with a certain characteristic of the loan. Only for a loan in a specific amount, for a certain period of time. Usually, this rate is associated with a so-called representative example.
If your creditworthiness is worse, or if you decide on another loan option, it may be completely different. Interest may rise by several percent. Not only is it appropriate to count with this negative. We recommend reaching out to those banks that have the highest interest rate in addition to the lowest interest rate. One that is intended for those clients who go through the so-called fous approval process. They know what the least advantageous bank loan can look like.