Applying for a personal loan at the bank may seem like a great idea, but only until you put the interest on the tip of the pencil and see that you will pay much more than you used to. Therefore, looking for cheaper alternatives than bank credit is a way to appreciate the health of your pocket.
Although the request for help from financial institutions is well known and sometimes even practical because you are already a bank customer, there are other more advantageous possibilities. Each has its own characteristics and can be perfect for what you are looking for. Therefore, Good Lenders listed 5 of these alternatives for you to decide which one is ideal for you. Check-out:
Loan with people close to you
One of the best-known ways to obtain funds without having to go to banks is to apply for loans from close people, such as friends and family.
Although normally the amount available is not so large, it is possible to have access to conditions that do not exist in the market, such as zero interest rates and large installments.
While it is very simple to order, it can also be easy not to pay as agreed. Therefore, care must be taken so that money does not disrupt or damage relationships.
But remember: this does not mean resorting to loan sharks! Lending by individuals through interest and unregulated collection is illegal and, eventually, less advantageous than in banks.
Do you have a very nice plan, a dream or even a need and you can’t afford it? Perhaps you have many contacts who can help you. If everyone gives a little, it is possible to collect all the money.
It is in this scenario that crowdfunding enters. They are an evolution of the famous kitty and allow each one to pay a little of the desired amount, according to their own possibility ?? the advantage is precisely this: there is no need to look for someone who has a large amount available to help you. Often, those who collect the resources can offer prizes and rewards, symbolic or not, for each range of contribution.
The Lite Lending website is an example of online crowdfunding. In it, you create an account, establish your goal in cash and write a little text explaining why you need the amount (remember that you need to convince people! This is going to be your campaign). With the kitty created, you can disclose on social networks and follow the website how much of your goal you have already achieved. But be careful: websites that offer this service may charge fees for doing so.
Credit unions are associations of individuals, inspected by the Cream Bank and, therefore, can make several financial transactions. For a membership fee, members can have a checking account, credit card and apply for loans, which are alternatives to bank credit.
The big advantage is that interest rates are much lower than in traditional financial institutions. In spite of that, be careful to choose one that is really authorized by Cream Bank, otherwise, it is not valid, ok?
Advance of funds
And when you know you have what to get at the end of the month, but you need credit now? If you can’t wait, the way forward is to use advance funds. This is one of the best alternatives to bank credit, mainly because it is money that is already yours, just not available at the moment.
For those who are employed, this comes in the form of seeking advance payment of wages, holidays or the 13th, for example. Although it is advantageous, this possibility requires planning, because, ahead, you will not be able to count on this money that has already been paid in advance.
To escape the abusive interest that banks may charge you, a good alternative is to use credit offered by online companies. They are institutions that act as banking correspondents, but which, due to the lower costs with structure and the intelligent analysis of user data, are able to offer lower and personalized interest rates.
In some of these institutions, the process is somewhat bureaucratic: it is necessary to present proof of residence, income and income tax return. This is not the case with Just, a partner of Good Lenders, where it is much faster and more practical. In it, the scanned identity document is enough for the customer to go through an analysis and then have the money released in his account within up to one business day.
Now that you know these alternatives to bank credit you can explore them and get rid of the abusive rates of many loans on the market. But remember that prevention is better than cure, isn’t it? So, don’t forget to adopt a spreadsheet.