Banks are slowing down with high interest rates.
Many bank customers have to pay almost 15 percent if they overdraw their account. The Feerate has examined the conditions of more than 1,600 banks in a recent investigation and confirmed what everyone already knew.
On average, according to the consumer bank, banks demand 12.4 percent interest pa. A supposedly cheap checking account will quickly become a cost trap for many. Usually, overdrafts are given up to three times a monthly net income. At 1800 usd monthly net 5,000 usd credit limit are easily possible. If the MRP is used on average to 60 percent, the interest costs amount to 12.4 percent interest to more than 370 usd a year.
Fortunately, there is a way out: With a installment loan, the account can be compensated quickly and at much more favorable conditions. An additional burden can be avoided if a correspondingly long running time is selected. A case study.
The effective interest rate
A installment loan over 3,000 usd costs 60 months and a nominal interest rate of 6.00 percent total 480 usd. This corresponds to an effective interest rate of 6.17 percent. The monthly rate is 58,00 usd. The monthly interest costs for the credit line are just under $ 31. For an additional charge of EUR 27, borrowers will receive immediate account settlements and secure repayment of accrued debts.
Unfortunately, account holders are more likely to opt for the wrong route and remain in the account overdraft. Anyone pushing the account balance forward for another three years pays more than 1100 usd in interest and has not paid off a penny.
From a business point of view, the MRP is an excellent opportunity for an installment loan. In our daily practice, we learn something else: Many customers shy away from the loan application, if their account is in the lousy. A used Dispo alone is not a reason for refusal (not at all!). Finally, only the agreed credit line is used.
The situation is different when the account balance slips into the tolerated overdraft. This happens very often when the dispo is permanently maxed out to the stop. For some (not all!) Banks, such overdraft may already be an obstacle. It is expensive anyway: interest rates of 15 to 19 percent are not uncommon.
Anyone who is one of the victims of the Dispo proliferator should take the investigation of Feerate as an opportunity and reschedule. Then not only will interest be saved: perhaps for months with a guilty conscience extended account balance returns within a few days back into the green area.
All information without warranty.
How much interest do you pay for your credit line? Switch now on favorable installment credit!