Having the possibility to choose among the many loans currently on the market , the one that best suits your needs, is very important. As it is an operation that will affect your budget for several years, it is essential to find loans at affordable rates .
Easier said than done, you will think. Where to start? The first thing you generally do is go to your bank . It is true that if we already know each other, being clients for perhaps years, the loan can be approved more easily. But it is not said that it is the most convenient in economic terms. Where and how to find cheaper rate loans?
Are Loans Affordable Online?
We can say yes. The online offer is much larger than the traditional one, so it is easier to find a loan that suits your needs.
Online loans are often cheaper and faster to obtain than traditional loans.
This is because the process is faster and the procedures are simplified , in this way some incidental expenses are eliminated .
So online loans almost always have cheaper interest rates and flexible amortization plans , customizable financing solutions, depending on the needs and economic conditions in which the individual customer is facing.
These solutions are also highly appreciated for their convenience , in fact not only can you find the cheapest loans online, but also manage the whole process directly from a PC or smartphone: get a free quote, take out the loan and manage it entirely online. Usually these types of financing , especially for small sums, can be disbursed in an extremely short time, even in 24 or 48 hours.
Applying for an online loan is no different than applying for a bank or financial office .
The documentation to be presented is in fact the same, but conveniently sent in digital format.
In addition, even the signing of documents can now be done virtually, through security systems that vary according to the financial choice. In any case, the procedures are very simple even for those who are not very familiar with new technologies.
Online loan security is also guaranteed like a traditional loan.
What affects the cost of the loan?
When applying for a loan, you need to understand what the real cost of your loan will be, to avoid bad surprises that are too late.
The indication of the interest rate is certainly important but it is not the only thing to consider. Usually the essential information to get a precise idea of how much the loan will cost is contained in a document that the bank delivers to the applicant, the SECCI form, which is provided during the pre-contractual phase.
Always check carefully:
- The TAN : Nominal Annual Rate , is the pure interest rate that banks and financial institutions apply. The lower the TAN, the cheaper the loan installment will be.
Evaluate the most convenient TAN, but don’t forget to compare the offers by also calculating the ancillary costs. In fact, this aspect could often go unnoticed at the time of the estimate, and then have bad surprises later.
- The APR , the Annual Global Effective Rate . It is the APR that has the greatest impact on the loan; it is a percentage index that also includes the TAN and the costs of the preliminary investigation, the opening of the file and the signing of a loan protection policy. This value allows you to immediately understand the convenience of financing .
The ancillary costs represent the costs related to the services necessary to manage your loan. The main ones are:
- The preliminary costs;
- Collection and installment costs;
- Stamp duty / substitute tax on the contract;
- Closing costs of the file;
- The cost for individual periodic communications ;
- The cost of any insurance.
Always remember to check if there are insurance coverage to be taken out at the time of signing the contract, in fact, depending on the type of financing, this could be mandatory or optional .
The term of the loan also affects the total cost .
Often an advice that is given is to extend the duration to reduce the installment : in this way it will be more sustainable you will get the loan more easily.
Obviously a longer duration means a lower installment , therefore more easily sustainable over time, but a higher total cost of the loan (the more time it will take you to repay the capital justly the more interest you will pay).
Keep in mind that, for banks and financial institutions , one of the fundamental conditions for granting the loan is the ability to support the economic commitment entered into. The finance company assesses your repayment ability by examining the ratio between installment and income received and checking that this does not exceed 30% of the total income.
How to find the loan at cheaper rates
Before choosing any financing , online or traditional, it is always recommended to compare the different possibilities offered by the market. The most effective way is to use an online comparator.
How does it work?
This tool allows you to compare different loans together , in a short time and without additional costs. Just chat with us for a few minutes!