How to take out a loan so that you don't regret it later

Do you need a loan at all?

This is the first question to be answered before going to the bank. It is possible that there is not enough money for the coveted purchase due to the peculiarities of your approach to financial management. If you revise it, it is possible that you will not have to borrow money.

Analyze where your funds are going. Surely you have a bank's mobile application - it's time to study the statistics and structure of expenses. Most likely, the result of the study will unpleasantly surprise you: we often spend money on all sorts of nonsense, we sin with impulsive purchases, and then we suffer that we have to live from paycheck to paycheck.

Calculate how much you could save by avoiding unnecessary expenses. If the amount is comparable to the planned monthly loan payment, you can do without the help of a bank. Yes, you will have to deny yourself small pleasures, but after all, you were going to take a loan for a reason. You can often save up for the thing you dreamed about on your own. You just need to pull yourself together and stop throwing money left and right.

If you are facing major expenses, such as repairing or buying a car, you will have to save up for a long time. Credit is the right decision. Once a month, you will repay the debt to the bank in small installments, without worrying that prices are rising and you have to save more and more.

How to understand how much money it costs to borrow from a bank?

If you cannot do without a loan, calculate all the risks in advance. Subtract from your salary the monthly expenses for utilities and communications, expenses on food, travel to and from work. Halve what remains. As a result, you get an approximate amount that you can give to the bank and not be stranded at the same time.

It is worth calculating the amount of the loan and the time during which you plan to return it in such a way that you spend no more than 30% of your income per month. Ideally 20%. It will take longer and with an overpayment to return the money, but you will be sure that, in principle, you will be able to repay the loan.

A good option is to create a financial safety cushion in advance of at least three of your salaries. If unforeseen expenses arise, she will help you make the next loan payment on time.

Do I need to insure a loan?

Let's imagine that events are developing according to a very bad scenario. You borrowed money from a bank, but suddenly you are left without a livelihood. Illness, dismissal, whatever - the loan still needs to be repaid. The bank can help you with this.

Raiffeisenbank, with which we wrote these cards, has a financial protection program for borrowers. It is valid for consumer loans and allows you to fully repay the debt to the bank at the expense of insurance payments. You can apply for participation in the financial protection program when filling out an application for a consumer loan.

For example, if you lose your job, Raiffeisenbank charges you a monthly payment while you are unemployed. At the end of the month, this money will come to your account.

The decision not to insure a loan is an extremely dubious idea. We cannot say with certainty what will happen even in a month, let alone a longer time frame. If you don’t need bank support in the end, great, but if something happens you have where to turn for help.

What else do you need to know before applying for a loan?

Find out if the bank has additional bonuses for borrowers. For example, Raiffeisenbank has launched new conditions for consumer lending: a year after the loan is issued, the rate is reduced from 11.99 to 9.99%. Such conditions are possible when applying for financial protection. If you still do not want to insure a loan, the rate in the first and subsequent years will be 16.99%.

The rate cut fixed in the agreement is now especially relevant. Recently, the Central Bank has been constantly reducing the key rate. As a result, bank lending rates are decreasing.

For example, in 2018, the key rate is expected to decrease by 1.25%. Accordingly, rates on consumer loans will also go down. If the agreement contains a rate cut, like Raiffeisenbank's, you don't have to waste time and nerves looking for profitable refinancing options.

It doesn't matter how much and for how long you borrow. In any case, the rate in the first year will be 11.99%, and then it will drop to 9.99%.

You can apply for a loan at Raiffeisenbank without collateral and guarantors. If you already have a bank salary card, you only need a passport and an application form. You can apply through the call center. The decision on whether the loan is approved or not will be made within an hour. If you apply for a loan on the bank's website, you will have to wait for the verdict only 5 minutes.

A loan is a convenient and profitable financial instrument if you study the conditions in advance and assess the likely risks. Decide if you really need it, and soberly assess your options for the total amount and monthly payments. With the right approach, credit will not turn into a constant headache and a source of anxiety.