When looking for opportunities to earn additional cash, we often go to the internet first steps. We will find here a lot of different offers regarding attractive cash loans or so-called payday loans. It is obvious that in the first place we are interested in the cheapest offers, thanks to which after paying off the loan more money will remain in our portfolio. For this reason, the main goal of our search will be a commission-free loan or a zero-interest loan. The prevailing competition on the market has meant that we can choose offers. We can easily find cheap loans or free loans. However, not everyone knows how a loan differs from a loan.
Loan and credit – Differences and similarities
Both of these words are often used interchangeably by bank customers. However, as it turns out, they only have in common that they relate to the transfer of funds to one entity by another. In addition, they differ in almost everything. The main difference is in legal matters. The rules for granting loans are governed by the restrictive law of . The Banking Act of 1997 clearly states that only banks can grant loans. As for loans, all legal issues related to them are regulated by the Civil Code. Importantly, loans can be granted by anyone who has sufficient financial resources for this. All this makes loans more easily available to customers but is therefore much more expensive. Law requires great caution in granting loans and clearly defines the conditions for obtaining them. Granting a loan is a matter of relevant provisions in the contract (in the case of low amounts the contract is not required).
Loans are much more expensive than traditional bank loans. Due to the fact that the conditions for granting them are not subject to the Banking Act, loan companies can freely set their amount and apply less stringent requirements for borrowers. As a result, when signing a contract with a loan company, we usually agree to high interest rates. APRC of loans reaches up to one hundred or more percent compared to a maximum of thirty in the case of cash loans. Such high APRC usually consists of various types of administrative fees and commissions for granting a loan. The interest rate itself is not high at all. However, the total costs are quite high and loans are in a privileged position. Unless of course we have credit standing.
No commission loan
Of course, a short search is enough to easily find loan offers that will not include commission costs. Usually, however, lowering the commission to zero results in other fees being raised so that the loan company would eventually earn as much as it was supposed to earn. Therefore, it can be assumed with high probability that in the case of free commission we will pay slightly more administrative costs or the annual interest rate will increase.
The first free loan
Fighting for clients, loan companies also offer promotions consisting in the fact that the first loan is completely free of any fees or commissions. It’s completely free. For example, if we borrow USD 1,000 for a period of one month, if we repay the borrowed thousand before the expiry of this period, we will not incur any additional costs. The company does not earn on us, but it gains a customer who in the future may offer another loan, which will no longer be free. Theoretically, this is a situation in which both sides gain.
Where to find the best offers?
Loan companies are happy to advertise on the internet. However, we should be indifferent to flashy advertising slogans or colorful banners. The best place to find the right offer will be online loan comparison and rankings. They allow you to sort the current offers available on the market in order from the cheapest to the most expensive. We immediately receive information about the total cost of loans and all fees. In the case of installment loans, we will also receive information about the amount of the installment, if any. With this information, choosing the best loan is a matter of seconds.
Cancellation of a loan
Polish law allows the possibility of resigning from a loan within 14 days. Even if we have already received funds to the account, we can send a letter in which we decide to cancel the contract. We do not have to give any reasons for our decision. We simply send a letter and return the full amount to the loan company’s account within 30 days. We do not have to pay any fees or commissions.