More flexible than a mortgage, easier to use than an assigned credit, the personal loan is a type of loan that offers many advantages to its beneficiaries. Here’s a quick roundup of Younited Credit’s advice on personal loans.
What is a personal loan?
The personal loan is a credit belonging to the category of consumer credit by which a loan is granted by a credit institution or a bank to a borrower
A loan to use without supporting documents
Unlike real loans, which are intended to finance a real estate project, the personal loan is characterized by the fact that it is not dedicated to a particular project. This means that its beneficiary can use it as he sees fit, without providing proof to his bank or credit institution.
The personal loan can therefore be used for various projects such as leisure, a vehicle, housing, or even simply to increase its cash flow in order to avoid, for example, paying too heavy agios in the event of a bank overdraft.
How does loan repayment work?
Like any credit, the personal loan obliges the person who took it out to repay the amount borrowed, but also all ancillary costs such as loan interest, insurance or file costs.
In concrete terms, the borrower undertakes to repay each month, on a fixed or variable date, part of the capital borrowed, as well as the interest which constitutes what is called the cost of credit. The part of the capital as well as the interest on this part of the capital are grouped together to constitute the monthly payment to be reimbursed.
A loan that can be repaid early
Taking out a personal loan can be interesting for borrowers who have some visibility regarding their future repayments.
This reimbursement will generally be made in return for a penalty, the amount of which cannot exceed 1% of the amount of the credit when the duration remaining to be covered is greater than 1 year, and 0.5% if the duration remaining to be reimbursed is less. at 1 year.