Comparative personal loan, credit card and overdraftCredit Card
When we are in the red we are faced with various credit options to circumvent our financial situation. While some alternatives offer immediate solutions, it is important to be aware of the details. Personal loan, credit card or overdraft? Check out the best answer in our text!
Why are so many people in debt?
You may not know, but the factors that influence the indebtedness of Brazilians are many. Lack of financial education, low income and ease of getting credit is one of the main reasons for unpaid debts.
In 2017, the SPC was around 59.1 million in Brazil alone. Nonpayment of credit cards and late installments of cars are the main reasons these numbers exist.
Interest Rates – Personal Loan, Credit Card and Overdraft
Personal credit is a type of loan that needs scrutiny to be approved, so it has lower interest rates than overdraft. However, because rates vary from one institution to another, personal lending is the most economical option of the moment. Rates usually range from 6% to 8% per month.
The overdraft is a pre-approved bank account credit. Although it is an option that requires less energy because of practicality, it has higher interest rates.
Even though few people know, every financial institution has the power to change their interest rates, as the default is between 13% to 15% monthly. To stipulate the amount, institutions use the total amount and time taken to repay the loan.
Finally we have the credit card option, however, this is the power that must be strictly controlled. Paying the minimum rather than paying the full amount of the invoice is a danger as revolving credit interest may exceed 400% per annum.
Best way to pay less interest?
Avoiding revolving credit card and overdraft is the first step. However, if an emergency has occurred that made you use this option, look for ways to pay off your debt as soon as possible. Remember that these alternatives have interest rates that are corrected per day, so it is important to leave them in the past.
Don’t have the money to pay off the debt? Then it may be that the best option is to propose a negotiation with the bank. Search for the manager to find the best way to pay this debt.
You can know some tips for negotiating your debt with the bank by clicking here.
Going for a personal loan that offers lower interest rates is also an alternative to repaying this debt. To save money, it is important to do a price survey.
Remember that those who do not have any overdraft or debt have a higher chance of getting better amounts at the bank that already have an account.
It is important to be careful
The overdraft is something that deserves your attention. Although it is a pre-approved credit, it has higher interest rates. In emergency situations where there is no other alternative, it is important to use it with great responsibility.
In addition to the above information, you can check out more detailed content by clicking here. If you have any questions, just ask us!