Bank loans, why are they charged with what amount?



When searching for a suitable bank loan, understandably pay special attention to its costs. Insurance, loan interest and the bank commission we are discussing for cash, consolidation or mortgage loans are inherent costs of the loan. But do they always have to be all three?

Not necessarily, there are loans without insurance or a bank commission. Zero commission loan offers are not always cheaper than those with a commission of several percent. The credible cost of credit is illustrated by the APRC meter.

Granting of a loan, bank commission

Granting of a loan, bank commission

There is no clear definition of a bank commission. This concept covers many activities used by banks, a fee for preparing a contract, a fee for granting or borrowing funds.

The commission is not always required, however, when banks encourage zero commission, in return they assign a maximum loan interest rate of 9.99% per annum and insurance fees. Comparison of bank offers should not be done by comparing only commission costs, but all three most important components of the loan price such as commission, interest rate and loan insurance.

Bank commission amounts range from 0% up to 25% of the loan amount obtained. All fees depend on the customer’s score calculated. The better the customer, the cheaper the loan. The best possible loan costs can be obtained by attaching a surety.

Renewable Loan, renewal commission

Renewable Loan, renewal commission

Commission for bank loans also occurs in the case of a revolving loan. The bank grants the customer a loan for a predetermined period, be it 12 or 24 cities. After its expiry, the customer decides whether he wants to extend the revolving loan. If so, then bear the cost of the bank commission again. When applying for a revolving loan, it is worth asking about the commission value when renewing it.

Loan repayment ahead of time, bank commission

Loan repayment ahead of time, bank commission

As the paragraph above, the most important thing when applying for banking products is to carefully read what we sign. Bank loans are usually granted for a longer period of time, even for 10 years. If our financial situation improves, it is worth asking about the possibility of paying off the loan early. Important then are the costs arising from such action. Banks earn less for us because the loan period is shortened, ie the bank does not collect fees resulting from the loan interest rate. Therefore, it compensates this fact with commissions resulting from earlier repayment of the loan by the customer.

Does each bank charge a commission for repayment of loans early?

Does each bank charge a commission for repayment of loans early?

Not every bank charges a commission resulting from early repayment of a cash or consolidation loan. There are banks that do not take it into account at all in loan agreements. The most important thing, if we are going to pay back the loan ahead of time is to ask about the costs.

To compare offers, it’s a good idea to turn to a proven credit intermediary. The specialist will present us the cheapest offers available on the market. Offers tailored to our situation, taking into account our possible problems.

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