Credit loan

To finance a personal asset you will need to borrow money from your bank. But you don’t have a property yet, so how do you get a loan or mortgage. In order to get a loan but without any collateral or security for the loaner means you will get a loan on credit. The credit loan is given based on the financial strength of you as the borrower. How do you get a credit loan? What do you have to take into account when going to the bank for requesting a credit loan?

Financial strength

The bank will judge your personal situation. What kind of income do you have and under what kind of contract to you have this job! Next to your normal expenses do you have additional debts which negatively influence your borrowable amount? Normally this will be registered as you can only get a credit loan in case your financial history is clear as well. Are you a bachelor, living together or having a family of your own already? For instance if you live together and you both have an income, your financial strength is much better in the eyes of the bank. Therefore

Interest rate

Within a credit loan you as the borrower don’t bring in collateral to support the loan. Only your financial strength is the basis of your credit loan. Therefore you are of higher risk to the lender. You as the borrower will need to compensate this with a higher monthly interest rate. The interest rate will be according to the market and reasonable also. This depends also on the development of the economics over time. To compare several lenders against their interest rates for your credit loan you should access internet.

Borrowable amount

The amount you are able to borrow depends greatly on your financial situation aka your monthly income and monthly expenses. When going to the bank for requesting a credit loan, the bank will need to have access to information on this. This information will be analyzed on risk, based on which the bank can calculate how much they are able to lend you. As you might be categorized as risk full the interest rate might be higher than normal. Due to this the amount you are able to borrow will be lower as well.

Be advised

If you want to get a credit loan based on two incomes, you should be advised. As the economical situation in the world improves, jobs are secured as well as your income. But when the economical situation gets in a recession, no one is sure about his or her job. In case you both have a job, it is un-advisable to get a so called top-loan with which you use all the financial space in getting a credit loan. If one of you loses the job, you also will not be able to pay your monthly obligation. When applying for a credit loan you should try to maximize it in filling the financial space of one person. This will give you breathing space in case you do lose a job or in case your financial situation does change drastically.