Which type of credit to choose before the holidays?

If you are planning to entertain your relatives, friends and acquaintances during the holidays, but with finances not as easy as you would like, then it is time to look at more types of credit. By weighing the pros and cons of each type of loan, you can more easily decide which type of loan would be more profitable before the holidays. The most popular and simplest type of loan is fast credit.

Consumer credit

Consumer credit

Nevertheless, this type of loan is most convenient and easily accessible to almost any resident who has reached the age of majority. When it comes to the most advantageous type of credit before the holidays, it is definitely worth looking at the consumer credit offer. This type of loan is not as readily available as a quick loan, but the borrower has the option to choose the loan repayment term. These can be 3 months or even 5 years. The higher the loan amount, the longer will be the repayment term of your consumer loan.

On the positive side, the consumer credit loan rate is well below the annual percentage rate of charge . The downside to a consumer loan is that this loan is not as readily available and may take several days before the bank or any non-bank credit company grants you this loan amount.

Credit line

Credit line

The next type of loan you could choose before the holidays is a credit line. This is one of the most flexible types of loan, which allows borrowers to determine for themselves how much money and when to borrow or repay. The only condition of the credit line is that the borrower must not exceed the credit limit set by him.

Credit limit

Credit limit

The credit limit is the maximum amount of the loan that can be set by the lender. The higher the borrower’s monthly income, the higher your credit limit will be. It is very convenient to use a credit line before the holidays, because in case your bank account balance is empty you can continue shopping. There is really no downside to the type of credit line loan, as it worked much like a bank overdraft, which you only pay when you use it. Some credit companies need to be careful as they charge a monthly fee for using this service. If the borrower is not careful, you can accidentally raise a large amount of money. You have to be careful with your credit line, because if your credit line is USD 1,200, but you haven’t paid attention to your USD 400 credit line balance, it can quickly grow to the maximum credit line amount.

It is advisable to choose this type of loan for borrowers who are very punctual and regularly monitor their financial situation. Forgetting people may have difficulty with this type of loan.