Lending is one of the most popular ways to buy the necessary equipment, find extra money before your salary or pay urgent bills. The population of the world has been actively using loans for many years. For many, they become a real salvation, especially if the salary is constantly delayed or income is not constant.
If earlier to receive money on credit without the certificate of official employment was almost impossible, today such loans are given by many companies. Apart from microfinance institutions, some small regional banks also agree to such a step.
But what are the main features of such loans? What does the client have to rely on? And what are the pros and cons of loans without a certificate of income?
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Advantages of loans without official employment
Loans of this kind have several advantages:
Time. In most cases, the borrower turns to microfinance institutions that issue such loans without problems. MFIs take much less time to complete a loan than a bank. The procedure itself is simpler and the list of required documents is much shorter.
The possibility to apply online. Websites like PaydayMe.com allow you to apply for a loan without leaving your home. Such organizations always have a convenient site and a personal office on it, where you can calculate in advance and the interest rate, and payment deadlines. All you have to do is fill in the application form and provide copies of the necessary documents.
Availability of loyalty programs. Many MFIs offer promotions and bonuses to new or regular clients. This way, the interest rate can be lower.
The possibility of prolonging payment deadlines. It is much easier to negotiate with MFIs than with a bank. Many companies go towards the client and allow for extension of payment deadlines. But it is important to understand that this can increase the interest rate.
It is also worth noting that such loans give a certain freedom and complete confidentiality. It is not necessary to take on a place of work any certificates.
The main disadvantages of loans without official employment
Such credit system has its shortcomings:
It’s a small amount. There is no need to count on huge sums of money, as both MFIs and banks do not give large sums to clients without a permanent place of work. But you can easily get a lifesaving couple of hundreds of hryvnias to your salary.
High interest rate. Compared to larger loans, the interest rate on such loans is higher. Thus, MFIs and banks try to protect themselves and their capital.
Shorter repayment periods.
How do I get around credit disadvantages without formal employment?
There are several ways to borrow on more favorable terms. The first is to find a company with regular promotions for clients. If you make a loan on time, you can get money at a reduced interest rate or count on a larger amount.
The second way is to take out a loan secured by property. It can be a car or real estate. More money is given under such a collateral and at a better interest rate. But not all MFIs take out such loans. But in banks, you can also do it on the security of a deposit.
And the last option is online crediting. In this case, the money comes to the bank card, and you can pay off the debt in the same way. Since the competition among MFIs is huge, many online services offer customers very favorable conditions and pleasant interest rates.
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