In the current economic situation, we are living, these words have become more common than ever. Not only because of the need we normally have to resort to financing but because of the recent concern about the conditions of these financial products.
We tell you that although these words are often used as if they were synonyms, a loan and a loan are two different services.
What is a loan?
The loan is an agreement between two parties, a lender (which is usually a financial institution, but can also be a friend) and a borrower (client or beneficiary), through which the first one lends a fixed amount of money to the second, which undertakes to return it within a stipulated period, either once or in several installments. This agreement usually carries some interest for the borrowed money, which is usually a percentage of the total money lent and is usually paid in the form of regular installments.
Mortgages are a type of loan, with specific financing characteristics.
What is a credit?
A credit is a financial aid service that consists of the entity making available to the beneficiary a maximum amount for it to have it as they need it. In this way, the interests are higher since it is a smaller amount of money that you can have at your disposal at any time.
One of the most common ways to access a credit is through the credit card, a tool to have money that we do not have in exchange for paying interest proportional to the amount used. Credit cards usually have two types of interests: the first are those related to the money that we are using and also, we pay a few second interests because we have the rest of the money at our disposal to use it at any time. moment. In addition, this service includes commissions for maintaining the credit card, since this is the way that allows us to have access to credit at any time.
Within this section, we can also talk about mini-credits, a money easily accessible through the Internet.
With these loans, you can get up to € 300 on your first credit and up to € 600 once you have returned the first in your estimated time.
Thanks to the minicréditos you can have a quick money, in just a matter of 15 minutes, you will have it in your account to give you the use you want.
These types of credits have a short retime, which normally goes between 30-40 days of return, but you can also return them in less time, resulting in a lower interest.
The so-called minipréstamos, are famous for their ease of request since it is personal loans online with which you simply need to fill some data through the Internet and you will not have to walk with paperwork. Even many of them allow to be in ASNEF.
You only have to fill in how much money you need, how long and the interest that will be charged will appear on the page. You will also have an area of the client in which you will have a username and password to see the status of your credit and your return date.
Main differences between credit and loan
With the loan, we only pay an interest rate, proportional to the money we borrowed at the time of the agreement, and it is paid regularly until the money is returned.
In the case of credit , a punctual interest is paid corresponding to a percentage of the money that we use at a specific time. In the case of mini-credits, this interest is around € 0.99 per day.
2. Amount acquired
The loan is usually used to access large amounts of money , either to finance the purchase of a house, a car or a project that we are undertaking, but almost always it is a planned expense. This makes the total interest also taller.
Credit is usually used for smaller sums of money, when it is necessary to face unexpected expenses. For an arrangement of some damaged appliance, to face a small payment of the income statement , school supplies …
3. Return terms
The loan is usually a long-term financial service, to finance expenses with a longer stipulated term of return of the borrowed money.
With the credit usually are acquired punctual sums of money whose terms of return are also shorter, as we have already commented before, they go of the 30-40 days maximum for its return.
4. Paperwork and waiting times
To request a loan, you must attend a bank in person, carry all the necessary documentation and have a clean file.
To request a quick loan or mini-credit , you can do it with simple steps through the Internet and without paperwork. In 15 minutes you can have the money in your account.
Advantages and disadvantages?
The use of one service or another really depends on the needs . It is not that one is more convenient than another, they are completely different products.
Loans are usually used for larger investments already planned and with a long-term refund, usually in the form of regular installments to which interest is added, so it is advisable to assume the risk that during the stipulated period we must have the sufficient liquidity to pay the due fees. Credits tend to have higher interest rates than loans, since having the possibility of being able to dispose of money on a timely basis without prior planning is a more expensive service, but useful and necessary for specific moments of lack of liquidity.