To be credited or not credited – a question that every person asks sooner or later. On the one hand, you can quickly solve financial problems right now, on the other – the money will have to be given away, and already with accrued interest and bank commissions. Foreign experience shows that citizens are accustomed to loans, acquiring housing, cars, financing business startups. But in the Russian system there is a significant difference – the percentage overpayment of the bank is incomparably greater than in Western countries, which makes one wonder whether banking facilities are necessary given the huge overpayments.
And yet, even in Russia, a loan is able to carry benefits and benefits, if you learn to properly use the financial opportunities provided by the bank.
Why do people take loans?
When a person enters the trading floor without a penny of cash, he hardly suspects that he will exit the store with a costly purchase. In the majority of hardware stores, banking consultants have been working for a long time, issuing commodity credits on a single passport within minutes. This situation shows a lot:
- First, it is very easy to get a loan, even without visiting the bank office.
- Secondly, the client is not used to planning personal expenses and is ready to make immediate purchases based on the principle of “here and now”, without thinking about the consequences.
- Thirdly, stores are happy to work closely with the bank, as the profit of the outlet directly depends on this.
As a result, in Russia it is difficult to meet a person who has never used credit funds to resolve financial issues, and the degree of debt load is such that wages do not remain a trace after repayments on numerous credit cards, inappropriate and targeted loans.
The desire to solve current problems with the help of a bank, without thinking about the consequences, is the first reason for the emergence of many non-earmarked loans from Russian borrowers.
But consumer loans and credit cards are only some of the total credit debt of Russians to banks. Target programs of the bank for large sums and large acquisitions are less common, but the total payments on mortgages and car loans often exceed the payments on non-target programs.
Making a mortgage in the bank for the purchase of housing, a person acts deliberately, in advance planning a mortgage transaction and preparing for it. There is no place for spontaneity, since it takes several months from the moment of the decision to the final part with the signing of the contract in the bank and the re-issuance of the right to property. The reason for contacting the bank is hidden in the inability to independently accumulate the required amount and in the absence of other options for acquiring housing or cars. As a result, the client contacts the bank and draws up long-term mortgage liabilities with monthly payments that take up half of the person’s earnings.
The absence of an alternative solution to a financial problem is the second reason for the emergence of a loan debt to a bank.
It is impossible to unambiguously determine whether a loan is useful for a borrower. There are many reasons for lending:
- Immediate decision is a hopeless situation for the borrower.
- Creating a comfortable living environment.
- Chance without losing the quality of life to cope with temporary difficulties.
- Starting a business project with the hope of profit from business in the absence of start-up capital and investors.
There are other, less significant advantages of the loan:
- if a large loan is planned, the client draws up and safely repays several small loans, creating a positive credit history;
- credit cards have long replaced the endless “payday loans”, and with a quick balance replenishment, the bank promises not to charge interest;
- credit cards give the right to participate in bonus programs and at the same time use the bank’s plastic to store their own savings with the receipt of deposit interest.
You should not mention the advantages of non-cash payments on credit cards, including in Internet banking, you do not need to issue a debit card if the credit card replaces all the main payment functions.
Payback for comfort, or the negative effects of loans
A bank is not a charitable organization. Therefore, even the most attractive program conditions will necessarily take into account the financial interests of the lender:
- in percents;
- additional commissions;
- regular fees for connected options.
The advantage of the credit program is the transparency of the bank’s charges, while some financial institutions benefit from the borrower’s debt. The delay in the loan opens to the bank the prospects for the accrual of fines, penalties, penalties, repeatedly increasing the debt of a short-sighted client who is not familiar with the terms of cooperation in issuing a loan.
The most honest bank will offer a rate on a classic credit card from 10 to 30% or more. In practice, the percentage overpayment on credit cards often exceeds 30-40%, since there is a need to pay commissions for cash withdrawals, transfers and other plastic transactions.
The minuses of a bank loan are no less than merits:
- The need for a long time to pay an overpayment to the bank.
- When making collateral (as it happens on a mortgage or car loan), the property is in a long time in a burden, not allowing the borrower to sell it, change it, etc.
- In a negative scenario, overdue payments lead to a rapid increase in debt, connection to the work of collectors, vessels and the forced seizure of the property of the borrower in favor of the bank.
With the need for financing it is easier to get a classic consumer loan in a bank – then the rate is calculated immediately and included in the monthly payment. It remains only to follow the schedule and make funds on time in full.
Often the loan is capable of testifying to the financial literacy or illiteracy of the borrower. The differences in the programs of banks allow you to choose the best option, taking into account the capabilities and needs of the borrower. A careful analysis of dozens of options on the loan market will allow you to choose a banking program that, instead of a financial hole, will help a borrower to solve current temporary difficulties with profit.
Turning cons into pluses
If the borrower deliberately approaches the loan, you can avoid negative consequences and get a certain benefit. A variant of making a profit from a bank loan will be the registration of a mortgage with the subsequent renting it out. With a small amount, the borrower is entitled to apply for mortgage housing as an additional real estate. It is important to think in advance that the mortgage loan payment at the bank is less than the amount received monthly by the borrower in the form of rent. A few years later, without much investment, the mortgage borrower becomes the full owner of the property with minimal financial participation in this project.
Another option to generate income will be using a credit card. The task of the borrower is to choose the right plastic from the bank with optimal conditions:
- preferential cashing;
- long grace period;
- income up to 5-8% on the balance in excess of the credit limit;
- increased cashback (5-30% of the amount of expenses) for popular product categories.
As a result, for the year of competent work with a credit card, an amount of several thousand rubles is formed in the form of a cashback or a percentage of the balance of its own funds. In conditions when the borrower did not use his own investments for such income, the option is rather attractive.
It is important to control the timeliness of replenishment of the balance before the interest-free period expires, and not to spend sums in excess of the wages received.
Lending in Russian banks is an eternal question whether it is worth taking a loan and analyzing the pros and cons of bank financing. Only a careful analysis and strict adherence of the borrower to the strategy will make it possible to profit from the advantages of a bank loan.