Usury loans, how to avoid them?

Be careful when choosing a non-bank loan. We will advise you on how to recognize usury loans.When choosing a non-bank loan it is necessary to be careful.

Loans, credits or even credit cards are currently offered not only by banks, but also by a number of non-banking entities. These include large non-banking companies as well as a number of other smaller non-banking entities.

We will advise you on how to recognize usury loans

We will advise you on how to recognize usury loans

While the financial products of banks have quite well described all the conditions and parameters and the borrower usually knows in advance what it will cost money to borrow, the situation in the non-bank market is much more complicated.

According to current surveys, more than 20% of Czechs have very low financial literacy. It is these people who very often fall victim to various rogue offers for loans. It is these people who most often use various usury loans. All they have to do is promise to get money easily somewhere. When they find a loan offer on the street or on the Internet that promises them money without proof of their income or with other “advantageous” parameters, then they often do not solve much what it will cost.

Even those who are at least a little oriented in finance, when looking for a loan usually consider only the amount of interest on the selected loan. This is very often the decisive factor in concluding a contract with a bank or non-banking company. But few who already study all the conditions in detail or realize what all the fees will have to pay. So in the end, a loan that looks good at first glance can be quite expensive.

How to recognize usury loans from the most serious?

How to recognize usury loans from the most serious?

Information = Before concluding a loan or credit agreement, you should find out all available information about the company that offers you the money and the terms and conditions of the offer. If you can’t find enough information about this company on the Internet, it’s suspicious. Every reputable company will have a lot of information on the Internet and will be talked about in various discussion forums, there will be promotional and press information, and much more

Compare multiple bids = never pays to accept the first bid. You shouldn’t be in a hurry to make a loan, especially if it is a larger amount (or an amount that can put more strain on your financial budget). Try to compare at least three different offers from 3 different companies

Read the terms = even if it is a long document, written in small print, you are sure to take the time to read carefully what you are committing to. The terms and conditions of a number of non-banking companies hide a number of tricky restrictions.

Choose serious deals

Choose serious deals

If you can no longer or do not want to borrow from the bank, try to contact larger and reliable companies. You can contact large non-banking companies on the toll-free info line (usually 800, certainly not 906, this is a toll-free line) and get all the information. Also, be aware of the “Loan Mediation” offers.

Do not borrow = if you really do not have to borrow. Even with the cheapest loan, you will have to return at least a few tens of percent more than you borrowed. And it will certainly burden your personal finances. A loan is usually just postponing an acute problem for later. If you don’t have the money for what you want, don’t borrow and try to save or reduce your expenses.

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