When you need to make a large purchase, and savings are not enough, the logical solution can be a consumer loan. We tell you where it can be taken and how to draw up a contract, so that over time http://usapaydayloans.info/tennessee/memphis/ it does not become a problem.
A consumer loan is money you borrow from a Bank to buy goods and services for yourself or your family. Consumer credit is issued only to individuals, the company can not issue it.
There are also consumer loans. They can be taken in microfinance institutions( MFIs), credit consumer cooperatives and pawnshops. In fact, it is the same as a loan, but the terms of the loan can be very different from the terms of the loan. For the differences between these financial services, see our video.
What are the types of consumer loans?
They can be divided into several features:
On the purpose
Consumer credit can be taken as a specific purchase-target, and without specifying the upcoming spending. For example, if you make a POS-loan in a furniture or electronics store, the Bank transfers the money directly to the seller. This credit target. If you take out a loan or loan and do not report on what it spent, it is considered inappropriate. On target loans rates may be lower, especially if it is an affiliate program of the store and the Bank.
On maintenance
When you take out a loan for a large amount, the Bank usually needs additional guarantees that you will return it. The loans are often collateral such as a car or other property, or surety of others. If the thing pledged to the Bank, you can continue to use it, but I can’t sell or donate it. In addition, the Bank may ask her to insure. On the other hand, interest on secured loans is usually lower than on unsecured loans.
On terms
The timing of loans and borrowings is usually very different. For MFIs, a short-term loan is considered to be up to 30 days («before salary»), and for banks, short — term loans-up to a year. The term greatly affects the interest on the loan and loan. Usually, the longer the term, the lower the rate. But not always-you need to study the conditions of a particular organization.
What conditions must be met to obtain a loan?
Each Bank, MFI or other organization sets its own rules. For example, to get a loan at a pawnshop, it is enough to show your passport and leave a pledge of something valuable. For a consumer loan in MFI usually also need only a passport, it can even be issued online. And the Bank, before issuing you a loan, especially for a large amount, can put a lot more conditions. But there are several General requirements.
Provide documents
There are only two mandatory documents: a passport of a citizen of the Russian Federation with a mark of registration (or other identity document) and a loan application.
When processing a POS credit consultants are often asked to show a second photo ID, such as law. It is necessary that scammers were not able to collect loans and loans on other people’s documents.