Debt Trap Credit Card – Revolving Card

The “Revolving Card” credit card is basically a flexible call credit with a cash card. A certain loan amount is available, which can be repaid either in one sum or in monthly installments. Repayment in installments involves a not inconsiderable interest or cost risk in the long term.

Revolving Card credit line

Revolving Card credit line

The credit line of a revolving card is determined individually, is unlimited in time and is based on the income and the creditworthiness of the applicant. Since this is nothing more than a loan, credit card companies and banks check your customers very carefully before issuing a credit card with a credit line.

Repayment of the credit card balance

Repayment of the credit card balance

If you have a Revolving Card credit card with a credit line of 1500 dollars, for example, you can now use it for purchases, services and, as a rule, for cash withdrawals. It is usually billed monthly. Many credit card providers grant a payment target for settlement after receipt of the invoice, which can be up to two months. No interest is charged during this time.

After you have received the statement, you can choose with the Revolving Card whether the outstanding amount should be repaid in full ( no interest accrues) or in partial amounts (loan accrued ). When paying back in installments, you have to comply with minimum requirements, e.g. 2.00 percent of the credit card balance, but not less than 15 dollars per month. These minimum rates can vary from provider to provider.

Interest on drawn credit lines

Interest on drawn credit lines

The loan interest for Revolving Card credit cards can amount to up to 25 percent a year, depending on the provider, and is therefore very high compared to a conventional installment loan. If you fully balance the credit card balance on a monthly basis, it is no longer tragic, since no interest accrues.

Interest on cash withdrawals : Some providers advertise free cash withdrawals, but charge interest on disposals from ATMs from the day of withdrawal. With a cash withdrawal of 500 dollars and for example 18.00% eff. Annual interest is 7.50 dollars for a full month on loan interest alone!

Installment payment

However, if one decides to repay in partial amounts, loan interest is calculated for the open balance. Below is a calculation example for the partial payment for a revolving card. For the sake of simplicity, we expect full months.

Key data : 1,500 dollars of credit line exhausted, 18.00% lending interest pa, 2.00% of the balance / min. Monthly rate of 15 dollars

  Balance open Minimum rate Loan interest pure repayment
1 month $ 1,500.00 $ 30.00 -22.50 $ + $ 7.50
2 months $ 1,492.50 $ 29.85 -22.39 $ + $ 7.46
3 month $ 1,485.04 $ 29.70 -22.28 $ + $ 7.43
4 month $ 1,477.61 $ 29.55 -22.16 $ + $ 7.39
5th month $ 1,470.22 $ 29.40 -22.05 $ + $ 7.35
6th month $ 1,462.87 $ 29.26 -21.94 $ + $ 7.31
7th month $ 1,455.56 $ 29.11 -21.83 $ + $ 7.28
8 months $ 1,448.28 $ 28.97 -21.72 $ + $ 7.24
9th month $ 1,441.04 $ 28.82 -21.62 $ + $ 7.21
10th month $ 1,433.83 $ 28.68 -21.51 $ + $ 7.17
11th month $ 1,426.67 $ 28.53 -21.40 $ + $ 7.13
12th month $ 1,419.53 $ 28.39 -21.29 $ + $ 7.10
total $ 1,412.43 $ 350.26 -262.70 $ + $ 87.57

Calculation of installment payments summarized

After twelve months, a total of $ 350.26 was paid in installments, but only $ 87.57 of the outstanding balance was actually repaid. In this calculation, $ 262.70 of the installment payment is due solely to the calculated loan interest and only benefits the bank. If this example were to be continued now, it would take over 230 months (more than 19 years!) To fully balance the credit card balance. Provided, of course, that the revolving card’s credit line is not exhausted.

Even if the calculation is presented here in a very simplified form, one thing becomes clear: if you compare the at least required repayment with the loan interest and make no special payments, you have a very expensive long-term loan. Most of the monthly installment is on the interest itself and very little of the actual balance is being repaid.

Conclusion on the Revolving Card credit card

Conclusion on the Revolving Card credit card

Even if the above explanations of this financial product do not look so good, we definitely do not want to talk bad about the credit card in the form of the Revolving Card. It represents a flexible financial reserve that can be used in an emergency. Two important points should be noted in connection with the Revolving Card:

Select credit card provider

Choose your provider wisely and take a close look at the terms and conditions, especially the small print. Not everything that is advertised as “free”, “free” or “free of charge” is actually free. Pay attention to terms of payment and interest, both for goods purchases and services and explicitly for cash withdrawals.

Use of the revolving card

In addition to choosing the right credit card provider, the use itself is also crucial. The use of the Revolving Card for expensive purchases with the idea of ​​paying off the amount in small installments is certainly the wrong way, even if the temptation is great. An installment loan would be the better alternative here, since it does not require so much self-discipline – installment amounts and terms are fixed from the start.

Credit card overdrawn and now?

Credit card overdrawn and now?

If the account of one or more credit cards is significantly overdrawn and you can hardly keep up with the installment payments or only serve the interest, you should consider rescheduling to a cheaper installment loan in this case. In the long term, this saves immense credit and interest costs. If the expensive overdraft facility on the checking account is also at risk, you should take this into account when rescheduling.

What type of loan to take out for your real estate project?

Need a loan to launch your real estate project? In practice, what are the types of Loans you can take out to finance your acquisition? If you look closely, there is indeed a wide range of loan types, from which you can choose according to your situation, in order to be able to benefit from financing. An overview on the question will certainly allow you to better find the credit that would best suit your needs. Knowing the selection criteria required by the establishments will give you the opportunity to prepare your files beforehand, in order to best prepare your credit application. But all this will only constitute a glimpse of what awaits you in reality, because the best way to complete your process is to entrust your file to a broker, in order to benefit from the best loan conditions.

Overview of the different types of loans to make your real estate project a reality

Overview of the different types of loans to make your real estate project a reality

Depending on your convenience, there are indeed a number of formulas among which you can choose an option for the choice of your mortgage. The advice of a broker will certainly be useful, to help you choose better among all these types of Loans. His skills in this area will be beneficial to you to help you find your way around and better decipher the different conditions offered by the establishments.

Among the usual forms of home loan, you have the choice between: the classic loan, the home savings plan or even the home savings account. Each of these formulas has its own specificities, and therefore they have their advantages and disadvantages respectively.

Otherwise, you can benefit from other specific offers such as the approved loan, the social accession loan or finally the zero rate loan. Again, all of these different alternatives have special conditions that must be met before they can be accessed.

Zoom on classic mortgage

Zoom on classic mortgage

It is indeed important to have all the useful information, to better know the types of Loans that would best meet your expectations. Also, you should learn about the details of the conventional loan, in order to better differentiate the various options offered and choose the appropriate formula accordingly.

Conventional real estate credit is effectively declined in different forms, namely the amortizable loan, the smoothed loan or with stages, the flexible loan, and finally the mortgage loan. You can possibly benefit from a bridging loan in the case of a simultaneous resale transaction and new acquisition. Otherwise, among the other versions of conventional credit, you also have the possibility of having a fine loan or a “no contribution” housing loan.

In short, there are so many possible formulas when it comes to taking out a mortgage, so the best decision is to enlist the help of a broker to help you see more clearly. A comparative study of the proposals received from the different establishments will be easier, thanks to the expertise of a specialist. You will thus have the advantage of benefiting from its informed opinions to choose the best offer, in order to finance your real estate project in the best conditions.

How to get a home appliance credit

Nowadays, digitalization is becoming essential. This is why electronic service providers have designed gadgets for every aspect of daily life. Help yourself with household credit!

The house is not immune to the trend of technological accessories. European housing standards even tend to prioritize smart homes.

If you too, you plan to equip your home with the most efficient electronic devices (washing machine, dryer, oven, etc.), opt for a personal loan to finance your household goods.

Which loan should you choose for a home loan?

Which loan should you choose for a home loan?

Here is some information to help you choose the most suitable loan when purchasing household appliances.

Financial organizations have set up a type of credit specially dedicated to the purchase of your high-tech appliances and accessories for the home. This is household appliance credit.

The home appliance loan is an installment sale or a personal loan.

Indeed, many devices wear out easily or become obsolete. In order to follow the trend in terms of consumer goods in housing, choose a suitable loan! Household credit is THE most adequate financial solution.

This type of credit is an integral part of personal loans or consumer loans. The borrower is free to use his capital for the supply of household appliances or other useful appliance to his home. You can then contact Across Lender and subscribe to an electro credit request via our simulator.

It is also possible to apply online by filling out the form and the information required on our simulator. Consumer credit requests will then be studied by financial agents before being validated.

But before applying for a loan, it is better to choose the formula suited to your repayment capacity. This means, a home appliance loan at a very attractive rate and with good repayment conditions. The annual percentage rate (APR) varies according to the amount borrowed.

Appliance loan request

Appliance loan request

The online loan application procedure is the easiest. If you have already found the formula that suits you, make your request directly on the site. If in doubt, use the services of a Across Lender advisor. The advantage of applying online is the saving of time, you limit your trips to the bank until the signing of the contract. However, care must be taken to perfect the content of your credit application. This document is the first step towards obtaining an appliance credit contract. In both cases, its content must be relevant and clear.

Usefulness of a home appliance loan

The advantages of such a credit should be emphasized in order to warn consumers of its importance. Like all credit formulas, you have the opportunity to get a real boost. With the economic crisis, households tend to postpone the purchase of essential goods. A home appliance loan is a good financial alternative to update your kitchen appliances (electric oven, pressure cooker, coffee machine, etc.) or those in your bathroom (washing machine, dryer, etc.). Basically, this loan offer helps you equip your home with the latest technology to make your life easier, because everything can be programmed without you having to lift a finger. Today, you even have the chance to buy devices that are more efficient and more energy efficient.

The point to remember when acquiring credit is that you should not exaggerate. Certainly, you have at your disposal a capital intended to equip your house but it is imperative to manage your loan well in order to buy only the essentials. The amount you request should therefore not be too high. All the more, that with too large a loan you will have to pay more interest. The bank will of course have to carry out an analysis of your repayment capacity before granting you a loan.

It is better to do a study beforehand before applying for a loan. By using a loan simulator, you will have access to more information on the rates and terms offered by Belgian banks. If you have any questions, contact your Across Lender credit intermediary.

Your file will be processed as soon as possible after your online simulation.

Warning, borrowing money also costs money.

 

The best advice and tips for your credit

With rates that are becoming more and more attractive, the French still use consumer credit. For some households, this solution has even become almost a habit with each need. A situation closely followed by the current authorities.

Consumer credit: a beneficial product for banks

Consumer credit: a beneficial product for banks

Compared to other bank loans, such as the mortgage for example, consumer credit remains the most attractive product for the bank. Even if rates are falling, the high demand numbers allow lenders to keep their liquidity always on the move. Which is also the goal. In addition, with shorter repayment periods, the borrowed money can quickly be reinvested in other areas. This is far from the case of mortgages which generally represent a high risk rate for banks.

Today, the banks are then putting forward their consumer credit offer, on the one hand to meet customer needs, than to remain competitive on the other. As a reminder, a groupama consumer loan is a loan granted to an individual in order to finance various purchases of goods and services, or other more important investments, such as the refitting of a house, etc. To find out more about this credit, visit this page.

The consumption credit of French households in figures

The consumption credit of French households in figures

According to reports from the Banque de France, the number of individuals using consumer credit is constantly increasing. Over the past six months, this upward trend has been confirmed with a rate of + 5.7% between April 2019 and June 2019. A rate which continued to climb during the following quarter with an increase of 6, 7%.

Faced with this situation, the authorities of the High Council for Financial Stability were rather concerned. Indeed, they fear a strong uncontrolled increase which could have a negative impact on the economic and budgetary situation of the country. Faced with this, the banks remain confident and continue to grant personal loans to consumers.

The worrying setbacks of consumer credit

The worrying setbacks of consumer credit

With the attractive conditions of access to consumer credit, households generally have no difficulty in accessing it. And the deliberation of the requested sum does not take time. A real boon for consumers.

However, this advantage has its share of drawbacks. And by dint of subscribing and still subscribing to several debts, the consumer could accumulate monthly payments and fall into a situation of critical over-indebtedness.

Despite this, the Banque de France says that this upward trend is not yet ready to stop. And we should still expect an increase in the numbers in the months that follow.