A loan can have different terms. In most cases, borrowers can choose how much they want to repay to the bank each month. It should be noted, however, that a loan with small installments brings a longer term. The more expensive the loan, because the longer the term, the more interest must be paid. But there may well be reasons to opt for a loan with small installments and accept the higher interest rates.
When should a loan be completed with small installments?
That depends on the income situation and other liabilities. Anyone who still has to pay installments elsewhere, for example at mail-order companies, is better served at low rates because otherwise there is a risk of getting bogged down. With low rates, you’re always on the safe side, even if the term is extended by it. So you are better prepared for eventualities that may arrive later.
But income is also an important factor in calculating monthly installments. An employee earns less money than a department head. The rates are correspondingly different. Those with only a low income should opt for a loan with small installments. An overload only leads to the fact that the rates may not be paid.
Special repayments on credit with small installments
Before borrowing, it makes sense to agree with the bank a special right of repayment without prepayment penalty. Many banks charge a fee for a loan to be redeemed early. But ultimately everything is a matter of negotiation. Sometimes the banks go in and grant a special right of repayment. Thus, the borrower has the opportunity, despite small installments to pay the loan early.
Find credit with small installments on the internet
Various platforms offer the possibility to compare the banks. The most important factors are the amount of the loan, the interest and the monthly installments. At a glance, the interested party recognizes which bank has the cheapest offer. It can also be clearly seen how long the term is at a certain amount of installments.
Normally, an existing credit agreement can not be changed afterwards. Therefore, you should think carefully in advance how much you can pay monthly installments. It does not benefit the bank or the borrower if they are too high and can not be paid. Better to choose a longer term with low rates, even if this means an increase in interest rates.