Refondation Ecole

Creditworthiness (solvency) – the ability to repay the loan taken together with interest on dates specified in the contract. The borrower’s creditworthiness affects the creditworthiness of the borrower, its amount and the repayment period.

According to the Polish banking law, having creditworthiness in this sense is a prerequisite for obtaining a loan. However, in some cases, a credit institution may give credit to a natural, legal person or organizational unit without legal personality without creditworthiness, if it agrees to establish a special loan security or provides a realistic plan to improve its financial situation.

Credit institutions independently and on the basis of their own criteria and procedures calculate the creditworthiness of people who have applied for a loan. Based on their own analyzes and calculations, they decide whether to lend funds to a given person and under which conditions. However, the borrower is required to provide the credit institution upon its request with the documents and information necessary to assess creditworthiness.

Factors affecting creditworthiness

The loan analysis is used to examine the creditworthiness of the borrower. Banks and other credit institutions use quantitative and qualitative analysis. The most important factors affecting creditworthiness are:

• income, their regularity and source,
• monthly expenses,
• current indebtedness (other liabilities, including credit cards).
• type and amount of credit,
• loan period,
• system of repayment of installments (equal or decreasing installments),
• the amount of own contribution,
• age,
• education,
• marital status,
• number of dependents,
• financial status,
• housing status,
• seniority,
• performed occupation,
• position held.

Creditworthiness may be reduced if several loan applications are submitted by the borrower in this short time frame, e.g. within a few weeks.

Increasing creditworthiness

You can increase your creditworthiness by increasing your own income and lowering expenses. Lower expenses can be obtained, for example, through the repayment of existing liabilities. This type of action should be taken before applying for a loan.

In addition, creditworthiness can be increased by:

• reducing the value of the loan requested by the borrower,
• extension of the loan period,
• change of installment systems,
• choosing the right lender,
• recruitment of a co-borrower.

Debt restructuring – debt cancellation or debt consolidation, which consists in extending the repayment period, suspension of repayment of installments for a specified period of time, or the granting of a completely new loan that will allow to repay the existing debt. The purpose of debt restructuring is the final return of the debt.

Lack of repayment of the debt incurred in time leads to entering the borrower on the list of unreliable and unreliable contractors, which results in the creation of a negative credit history. As a result, it leads to problems with obtaining a loan or loan in the future. Thanks to the debt restructuring, the borrower will avoid these consequences if they encounter liquidity problems.

What is restructuring?

Debt restructuring is aimed at dealing with debt obligations when the borrower is unable to pay them back within the deadline set for that date. The purpose of the restructuring is to eliminate bad debts and reduce debt.

Restructuring exists in accordance with the provisions of the Civil Code, which provides that the debtor has the right to negotiate with the creditor new payment dates when the previous ones are impossible to implement. This involves extending the repayment period. The introduction of changes in the current terms of debt repayment allows us to adjust to the current financial situation of the client and, as a result, lead to debt repayment without the need to run debt collection processes.

Debt restructuring methods

Debt restructuring may involve several jointly or independently taken actions:

• extension of the debt repayment period,
• suspension of installments,
• change in the interest rate used to calculate interest on liabilities,
• currency conversion of debt (in terms of currency debts),
• granting a new loan,
• debt consolidation,
• change of the security method,
• debt reduction.

Advantages of the solution

The debtor may apply for restructuring when its financial liquidity is at risk. Lack of contact with the creditor may result in the initiation of debt collection proceedings. placing the debtor’s data in the debtors’ registers. Debt restructuring is very beneficial for both parties. It helps to recover the debt owed to the creditor and repay the debt owed by the debtor.

Has your mother never taught you to tear off a patch quickly?? Then it only hurts a moment instead of pulling the pain out. She could have taught you the same about installment and consumer loans.

It has become more and more common to borrow money, and where loans used to belong to home and car purchases, it is now used for everything! Mobile phones, computers, clothing, shoes, vacations, training equipment; everything! It is seen as a service that you can split the payment over 12, 24, 36 months. Few people notice the 500-2.000kr. as the “service” costs.

The longer you pay off, the more expensive it becomes! That way, installment and consumer loans are your economy’s snooze button; You just postpone having to get out of the hot bed and start the day!

Preserved if it is the only option you have, and you lack a computer without 4000, – on your pocket, then it is a solution to get the computer right away. But whatever you turn around and turn around, it will always be cheapest for you to save money together.

If you can find 470, – a month to pay off a loan, can you not find 400, – for the savings either? However, the 70, – will not go to what you buy, but interest and fees.

Hard to save

Especially young people find it hard to put money aside, and that is as the mentality of borrowing money has changed.

It is no fun to have less money every month because a fixed amount goes to a savings account where they are just waiting to be used. So it’s more fun to have a computer now and then, and then pay it in the future. But here you have to think about the future: how hard it is, in a year and a half that every month there is 486, – to a computer you got so long ago!

But as I said; If you want to get cheaper, you have to steer clear of the installment! And fortunately there are tools that can make savings a little more fun. A user on Meer.dk will give you a visual overview of your finances every month, without having to touch a finger. Here you can first see what you spend money on now. You get an overview of your consumption and will be able to quickly see how many caffé latte you have to do without, to afford to afford a MacBook. Most people who try Meer get many of these kind of aha experiences, and quickly find out how important small changes can be.

Root in the economy damages you

Saving is not fun and you may not want to know your consumption. But rooted in the economy degrades your quality of life and there is a great mental reward in saving up for what you want and going down and buying it!

Simple loan agreement 

A simple loan agreement is a general form of legal document that establishes formal parameters for a loan arrangement between a lender and a borrower. In general, the simple loan agreement can apply to many different types of informal or straightforward lending as opposed to the elaborate, complex documents often prepared by large corporate lenders. Simple loan agreements can reduce legal and administrative costs, make borrowers more aware of what they have signed, and help avoid some specific issues and conflicts over the term of the loan.

Some of what defines a simple loan agreement is related to what it usually does not include. Unlike some complex loan agreements, a simple loan agreement will usually not include variable or variable interest rates. Variable or variable rate loans can leave borrowers confused by fluctuations in monthly payments. Variable interest rates may mean that a loan moves along with a low monthly service only “exploding” debt into what is called a “balloon payment.” A simple loan agreement can avoid all this with a simple fixed rate.

Another thing that simple loan agreements generally will not include is comprehensive sanctions for non-compliant payments. Some complex loans include prepayment penalties, interest fines for early payments, or other small details usually designed for the benefit of the lender financially. In a simple loan agreement, there is generally more versatility for monthly payments that apply to interest as well as the most important of a loan.

A simple loan agreement can also be written off differently than a conventional loan or mortgage loan. While loan amortization makes it easy to establish monthly payments, this type of loan tracking can actually make it harder to see how payments apply to interest and principal. Simple loan agreements will often take the path of least resistance to payment records that make the whole situation as clear as possible for both the borrower and the lender.

In many countries where unscrupulous lending companies are creating misleading offers make loan agreements complex and legally opaque, a simple loan agreement is highly sought after, not only for borrowers but for consumer lawyers and public regulatory agencies. Different nations deal with lending regulations in a variety of ways. Some regulating agencies will look at promoting a simple loan agreement as a way to effectively regulate lenders.

Consolidated loans – what they characterize

Many people borrow money, but often without any receipts, let alone contracts – which is a big mistake. Of course, there are also situations that when you need cash you do not have to be in a family or among friends, people who have much money. There may also be many other reasons why it is not easy to take out a private loan. The answer to such problems and needs can become just consolidated loans.

They allow you to finance small expenses, but you can borrow several tens of thousands of zlotys (in the case of entrepreneurs, it can even be several hundred thousand zlotys). Loans are taken from people called investors – via online platforms, bypassing financial institutions. The intermediary becomes the chosen internet platform, which charges a commission for borrowing money using it. As for the interest rate on the loan, it is usually set individually: by the investor and the borrower. It is worth knowing that on the Internet you can find smaller and larger portals offering consolidated loans, or you can divide them into those that offer loans to natural persons or entrepreneurs.

How can you get a consolidated loan?

If you want to download it online, you must first register on the selected portal, which takes just a few minutes. Usually, you have to enter there: name and surname, telephone number and e-mail address. Later, you will also need your ID card number and, of course, your bank account number. Verification of a registered person very often takes place in two stages. The first one is necessary and the second is voluntary, but it increases the credibility of the borrower. This means that after positive verification, the borrower is located at a specified, higher level (“rating”). The higher the level, the greater the credibility, the greater the chance for a loan (on really good terms). This verification “at your own request” allows you to climb the various levels of the selected portal with consolidated loans. It is also worth knowing that the first, or basic verification usually consists of:

• checking the compliance of the data from the scanned ID card with those provided when setting up the account in the portal,
• checking the telephone number, by sending a code which must be entered later in the appropriate place after logging in to the account,
• clicking on the activation link sent to the email,
• checking the number and details of the bank account – by sending a symbolic amount from it to the given account number.

On the other hand, exemplary activities in voluntary verification may include:

• consent to check BIK and BIGs, as well as to check the point score of BIK,
• sending a scan of another identity document (which will be compared with the proof),
• sending a face photo,
• verification of the address of residence: either by attaching bills to the media or by entering a code sent by post in the portal,
• attaching a certificate of employment (this can be confirmed by telephone conversation with the employer),
• confirmation of income achieved,
• signing a declaration regarding the lack of obligations for court and administrative proceedings and the lack of court, debt collection or enforcement proceedings that would be pending in the matter of debts.

It should be noted, however, that the high position in the consolidated loans portal is not given once and for all. In order to maintain it, every now and then you have to undergo various types of voluntary verification (because, for example, certificates of employment and income, or BIK verification will be valid for several months).

Consolidated loans – principles of obtaining and acting

After registering and verifying your account on the portal, the next step is to submit a loan application. The willing borrower defines its purpose here (eg the purchase of something), as well as the terms of the loan (amount, repayment period and preferred interest rate). Even before submitting the offer, you will receive information about the amount of the installment and commission charged by the online platform. After approval, the application is submitted and the offer becomes visible at the auction for investors (lenders). Later, there are waiting for proposals and applications from investors who want to grant loans on the conditions presented.

Then the borrower chooses the most cost-effective option and after finalizing the loan (you must usually pay a small fee) and enter into a suitable contract, waiting for the transfer of money (usually a few days). A consolidated loan is repaid in previously determined installments – immediately to the lender’s account. As for the costs of the loan, they include interest (often 10% per annum), a few percent commission on the loan payout amount – charged by the loan portal. Additional fees are also charged for the opportunity to promote your offer and additional verification methods.

Advantages and disadvantages of consolidated loans

The disadvantages of such loans include:

• service fees,
• costs related to additional verification,
• slightly longer waiting time for a loan than in a non-banking company or a bank,
• the need to show a large number of documents (to achieve a higher rating).

Among the advantages, you can mention is that:

• few initial formalities,
• cash borrows cheaper than in a non-banking company,
• there is no need to have a very good BIK,
• these may be loans for indebted individuals
• the money can be used for any purpose,
• the borrower decides how much he/she wants to pay for the loan,
• the whole is repaid in installments adjusted to its possibilities,
• everything is done without leaving home.

Finally, it is worth mentioning that in Poland they do not exist yet legal solutions regarding this type of loans. Therefore, both borrowers and lenders – in order to maintain security – should use portals with an established market position, enjoying a good reputation. Of course, it is also important to read the terms of the website carefully – so that taking a consolidated loan goes without any problems.

Getting credit at lower interest rates is one of the big challenges here in the world’s highest interest land .

Although the credit card’s interest rate exceeds 400% per annum (!) It is still possible to take advantage of some tips to get a cheaper credit.

Without further ado, let’s go to them!

1- Payroll Credit

One of the most common forms of secured credit, payday loan is a great way to get lower interest rates.

This happens because, here, installment payments are deducted automatically from your payroll. This ensures that you will pay your institution before you can even get the money from your salary.

However, exactly for deducing the payrolls is that this modality is not for everyone. Only signed workers, civil servants, military, pensioners and retirees of the INSS can have access to payroll deductible loans.

In addition, workers with a formal contract can only apply if the company they work with has an agreement with a bank.

2- Pledge

If you have some jewelry or much more valuable, it can be used as collateral to get a cheaper loan!

In this case, interest is lower because if you default, the bank can take your jewelry and sell it.

So be careful before taking a loan of this to not put as collateral any good that has a great value for you.

Here in Brazil the pledge can only be made by Caixa Econômica Federal . The valuation of the value of the good is done in the agency itself and you are already out with money on time!

3- Refinancing of Property

Also known as loan with property as collateral. That is, face to face we see the risk of this modality: in case you do not pay the installments the bank can take your property.

It is very important that you know about this risk before you incur such debt. If you plan well for the installments to fit your budget, and if possible plan B to help you if things go bad.

Going for more practical terms, it is possible to finance up to 70% of the valuation value of the property. In addition, the payment deadlines can be very large, up to 30 years!

With a little planning and preparation, this can be a great way to get lower interest rates.

4- Refinancing of Vehicles

As in the previous item, this is a way of taking credit by placing a good as collateral. Here, this good will be your car.

Again, the interest rates are lower because, in case you do not take the installments, the bank can take your car.

To get such a credit, you need to have your vehicle taken away (there are even some places that do not have this requirement, but they will charge more for it). Still, the car needs to be in your name and be less than 10 years old.

The car will be in your name during the whole process, however know that it is rather the guarantee with the bank.

The tip is the same for the previous items: if you plan well so you do not risk losing your car.

5- Anticipation of the 13th Salary

Leaving your 13th up ahead to have the money can now be a good choice if you are going through some emergency and need quick cash.

Since you will be anticipating money, normally the portion to be paid will be unique, and will be charged at the end of the year, once the amounts are deposited into your checking account.

You need to contact your bank agency to have access to this mode of credit and as the installment will be unique, you do not commit your monthly income.

Despite several facilities, know that there is a risk here: if your employer fails to pay or delay the payment of the benefit, you will still be charged and can end up with a debt greater than expected.

So make sure you think well about the risks before you take out a loan.

6- Make an Online Loan

This is an easy-to-access modality that does not stop growing in Brazil. 

Exactly because they do not have to pay as much personnel, nor physical structures as agencies, that these sites manage to offer credit at much lower interest rates.

However, not everything is flowers. Usually these websites do a rigorous risk assessment and not everyone gets access. In addition, there are also sites that offer everything online, but at very high interest rates.

So, never forget to compare all the options. The Low Interest platform , inclusive, is a great option for this.

Keep an Eye on the Beating!

Finally, take care of the blows! Before you take out a loan, check to see if the company really exists! Search for it on Google and ask people you know if they’ve heard.

Still, if any institution charges you a loan release fee, or any kind of upfront fee, run flat! This is one of the most common forms of coup in Brazil.

Lower Interest Rates for Everyone!

We hope these tips will help you get a lower interest loan! In fact, count on the Low Interest team to help you find the best loan for you!