Even if totally unwanted, most people have already faced a time of financial hardship. Whether it’s a prolonged unemployment situation or some unforeseen event that forces you to spend your savings, you may eventually be unable to buy even what was already in the planning. With this in mind, many financial institutions have increasingly facilitated access to so-called consumer credit, that is, to the loan you are requesting just to purchase those goods that are used in a day-to-day life of a person or a family .
But if on the one hand consumer credit can be your salvation in a case of instability, it can also be your doom if you do not take enough care. After all, like any other credit, you will be taking interest and charges at the time of hiring.
So if you are thinking of taking out the consumer credit, pay attention to the following tips and do it consciously!
How it works?
This type of credit is, in fact, a type of personal credit, where the amount received on the loan is normally used for purchases of installments. As its name says, the credit is destined to consumer goods, contemplating numerous applications, for example:
Furniture, appliances and electronics;
Purchase of basic utilities such as clothes and food;
Vacation and travel expenses;
Expenses with education, such as higher education;
Payments of debts that are in arrears.
The main benefit of this type of credit is the flexibility of acquisition, which can be provided through different modalities, such as checks, credit cards, personal loans and payroll loans. Similarly, the payment of consumer credit occurs in a variety of ways (ticket, carnet, debit, etc.), depending on the institution where you were hired and the contract you sign.
By encouraging the purchase of consumer goods, often these loans are offered in the very establishment where you want to make the purchase. Hence, you can do the hiring not just in banks and financial institutions, but also in department stores.
Do I need this credit?
The first thing you should do is identify what your case is. Do you really need that credit or could you wait to make the cash purchase?
If you can re-adjust your expenses, even if it is difficult, without requesting the credit, do not think twice, this will be the best alternative.
Remember that the risk of you not solving your current problem and acquiring increasing debts is very large. Therefore, it is important to create the habit of paying cash and only hire this credit if you really need it and if your situation allows it.
What do I need to consider when hiring?
In the rush to get the product right there, we forget about both a price survey and a search for credit options. So it is important that you always make sure that another type of credit would not be more advantageous, such as credit at the stores themselves, or even personal credit through your bank.
Second, ask for advice from various credit institutions, seeking to know all the conditions of consumer credit and then compare these offers. There is no credit that will always be better or worse: there is the best option for you and your need at the moment.
Search the internet about the financial institution from which you are hiring consumer credit. View customers ‘and ex-clients’ opinions about the company, seeking to know if it is correct and transparent in all procedures.
Last but not least, you should be aware of the fees involved. Especially note the Total Effective Cost (CET), which will tell you the full cost of the loan in question. This amount, by law, must be informed by the financial institution, but you also check on the PROCON SP Foundation website. With these data in hand, consider whether you have a budget planning that can pay, in due time, such charges.
Consumer credit should be an aid to your purchases and not a debt you get for the rest of your life. So pay attention to these tips and use consumer credit in your favor!