Loans repayable in 12 months: are they always the right choice?


The web has changed the way we approach the banking world, in particular for the investment sector (with online trading) and for that of financing. In the latter sector, in addition to acting on rates, obtaining a easing of economic conditions (especially for the elimination of accessory costs and in some cases also for the containment of the interest rates applied), it has above all revolutionized the methods and times of disbursement as well as the number of minimum installments.

So if until a few years ago short-term loans ranged from a minimum of 12 months to a maximum of 18 months, today the 12-month threshold has become almost the maximum with a minimum duration starting from just 3 months.

Installment and duration: what is the best relationship for you?

Installment and duration: what is the best relationship for you?

In a loan usually the shorter the duration and the lower the impact of the interest expense. On the other hand, the amount of the installment logically increases and can be difficult to sustain even if it is a rather limited period of time. For this reason, when choosing 12 months as the amortization plan for a loan, you must be aware that the installment for medium amounts will be very high.

It is no coincidence that loans repayable in 12 months are generally considered within the category of mini or small loans as regards “personal” loans. For those finalized it is in fact a “long” duration in the case of technological products and household appliances while it is insufficient in the case of the purchase of a car or a motorcycle.

To evaluate the best relationship between this duration and the amount of the installment to be repaid, it is useful to use a simulation tool. In this area there are two possibilities:

  • use a calculation tool made available by the person offering the loan (for example Lite Lender Company, Across Lender, etc.);
  • use an independent tool.

In the first case there is the advantage of being able to transform the simulation into a real loan estimate, to be saved and possibly forwarded and then to start the financing request in an official way. On the other hand, we are limited by the fact that the conditions are linked to the rate proposed only by the financial or bank rate. So the generic aspect of the evaluation is lost but the strictly practical one remains.

In the second case it is instead possible to do a generic simulation as well as various tests with “standard” rates without being tied to a specific rate proposed by a bank or a financial company. These ‘ super partes ‘ tools also make up for the lack of calculation tools by banks or financial companies that do not offer the online service. The tool is almost always reliable but one must remember to insert the exact Taeg applied and not the Tan. Finally, it must be remembered that a simulation does not have the character and does not offer the protection inherent in a real estimate.

How to choose?

How to choose?

In the small loan, the annual repayment term affects the maximum amount that can be obtained, since it will be equal to the monthly net salary, also influencing the possibility of renewal.

Outside of this particular category, however, there are other limits, as in the case of the transfer of the fifth and the vast majority of the debt consolidation loans: in both cases, the minimum duration starts from 24 months. So if you want to have a certain freedom of choice by aiming for a one-year loan repayment term, you must focus on what are generally considered fast loans, dedicated to those who need liquidity for short times and of limited amount ( although of course there is no shortage of exceptions, where sums of $ 10,000 or something more can also be reached).

For this reason, a generic tool is useful to get an idea of ​​what the market could offer on average but does not guarantee a complete and reliable knowledge contribution. For example, let’s take two institutions that have many conventions in the main shops and at the same time offer online loans such as Lite Lender Company and Across Lender.

For a modest sum like 1000 USD the two banks have in fact a very different policy: Across Lender allows you to repay the 1000 USD already starting from 6 months. Instead Lite Lender Company for personal loans does not consider the 12 months at all and starts from no less than 18 months ( as can be seen from the official website making an estimate of 1000 USD on 28/08/2017 ).

Also for this reason, an upstream choice made on paper is not possible and risks being misleading. In this perspective, the comparators offer the possibility of making a general assessment but it is always necessary to go down on the merits and then make a quote for more proposals that would seem the most convenient at a first comparison.

Who offers them?

Who offers them?

Outside the “finalized” loans, it is necessary to search for personal loans preferably classified as: mini, young, smart, etc. Not all banks expect them and the offer can be quite varied. For example we find:

  • Across Lender : from 6 to 120 months;
  • Webank : in the small loan from 6 to 60 installments;
  • Unicredit : starting from 12 months for the smart Voucher and the Mini loan (first also for the youth loan). For the Easy version which starts from just 6 months to reach up to 36 months (linked to the amounts requested).

Obviously these are just a few examples, which cannot replace a research and evaluation that must always be done in a very personal way, taking into account the characteristics that the required funding must have. Not all loans in fact offer the same characteristics also from the point of view of flexibility thanks to the presence of management options.

Conclusions and opinions on convenience

Conclusions and opinions on convenience

From what has been said, it is clear that 12 month loans are only useful for small amounts and urgent needs. In general, they risk making the installment / duration ratio not performing especially considering the fact that the shorter the duration and the greater the impact of the rates applied (as in the case of the Taeg which, due to ancillary costs such as management and preliminary costs, risks not to be “absorbed”).

How to pay a loan through the terminal?

Often, when we take out a loan, it happens that the payment deadline is approaching, and it is simply not possible to pay the required amount through the bank directly or even via the Internet.

Then the question arises, how to resolve this problem and avoid non-payment while maintaining a credit history at the level. In this case, the output will be paid through the terminal. How to pay a loan through the terminal will be discussed today.

Payment of a loan through the Good Finance terminal


Recently, the use of Good Finance ATMs have become a popular way to repay a loan through a terminal. This method is convenient in that in each city you can find the terminal of this bank, even without access to the Internet, a personal account or a bank directly.

Procedure for paying a loan


The process of depositing the amount is quite simple and confidential, the data is not distributed anywhere other than to the creditor bank and kept in the strictest confidence, and the payment itself is easy without a long process of choosing a service and making money. The procedure for paying a loan through the Good Finance terminal looks something like this:

  • First of all, you need to select the “Banking Operations” section. In this section, you will see various items. In one of them, it will be possible to repay the loan through the Peachum family, we select it.
  • After you have chosen a company, it is important to choose the type of operation that you will perform through it. In this case, you should focus on repayment or extension of the loan.
  • Next, you need to go through authorization, enter your phone number, which you used during registration, and the one that you use to enter your personal account.
  • The final step is making cash payments for the loan.

Credit payment 


It should be noted that Good Finance is not the only way to repay a loan through the terminal. Terminals are able to accept your payment for banking services as easily and quickly.

It is necessary to mention that before paying a loan through the terminal, you should carefully check the amount of the commission because if you deposit the amount of the loan without taking into account the commission of the terminal, the bank recognizes this for non-payment. The process itself consists of the following steps:

  • You need to find the Peachum family company logo in the list on the screen and click on it to open the list of services performed through this terminal.
  • Next, select the type of financial transaction that you need. In this case, you can choose either the loan repayment procedure or the procedure for its extension.
  • A further process is an authentication. You must enter the field of the phone number that you used when applying for a loan.
  • The final step is to pay in cash. After the operation is successfully completed, an SMS will be sent to the mobile phone with a notification that the loan is either repaid or extended.

Where to give a loan without problems?


Consumer lending in the country does not lose its relevance. However, getting financial assistance is not as easy as 3-4 years ago. Today, most banks have tightened requirements for the borrower, which makes obtaining a loan virtually unavailable.

But in 2018 there are other organizations where you can take money on credit without problems without outside help and, most importantly, on loyal terms.

Credit availability 


Why has credit availability declined? With a minimum wage of 3,200 USD, living a month is simply unrealistic, not like paying on a debt. Yes, and many employers continue to pay wages in an envelope, documenting all the same 3,200 documents.

But it is precisely those official structures that pay loans without problems that pay attention to official income.

For each creditor, the applicant must meet a certain level according to the following criteria:

  • Reliability – a high level of responsibility, stable social status, good credit history;
  • financial reliability – a stable salary, high income, property in the property.

Therefore, before going to the bank, it is important to understand how to get a cash loan without any problems.

What problems can arise during registration?


Given the above criteria, bank employees have the right to refuse extradition. However, the main reason for the refusal is not reported. What problems may arise if you decide to request funds:

  • If an unemployed person applies, most likely he will receive a negative answer on the application. Only installment items or credit cards can be available and given the fact that the borrower previously had loans, and all of them were repaid on time.
  • A pensioner will be able to take out a loan from a bank without refusal in most cases only until the age of 60. The fact is that some organizations impose age restrictions and do not serve citizens who have reached the age of 65-75. Pensioners are not credited because of the increased risk of default: the minimum pension in the country (and this is a low income for the bank), the likelihood of a poor health condition of the borrower.
  • Minors, and in some cases those who are under the age of 21-25, will also not be able to get a loan without problems. In addition to the upper limit, banking organizations set a lower age limit. According to the law, persons under the age of 18 are not entitled to draw up an agreement, and according to the bank’s internal rules, there are also restrictions for older citizens. Some are willing to cooperate only with clients over 21 years old, others are complete with those over 25.
  • The borrowed amount is also estimated taking into account the real profit of the applicant. For example, a person needs 100 000 USD, but after analyzing personal data, an employee can take only 50 000 USD.
  • It’s also impossible to get loans without problems if you don’t have a stable income every month. Even for the unemployed, it is possible to get approval (for example, for goods by installments), but only if he receives a regularly determined amount. For example, an unofficial salary or a percentage of the deposit.
  • Funds for treatment will be difficult to obtain for the reason that this is a risk. A client who takes money for treatment may be unable to work for some time, due to which there will be a delay or payment will cease altogether.

Banks giving loans without problems


On the example of the table, we evaluate whether there are banks in the country that provide loans without problems:

Loans without problems from MFIs


But what is the rating of credit organizations by microloans:


Based on the information presented, we can conclude that if you need a really large amount, you should try contacting a banking organization. If up to 20 thousand dollars is enough, it is better to use services where documents for obtaining a loan are not needed.

Unlike the banking procedure, there is no link to official employment, they do not ask for a workbook and do not look at the availability of the property.