Are you going to spend more and need to take a loan? We have good news for you: low-interest rates have meant that loans have long been not so cheap. How much? We checked it out! Below you will find offers of banks that will borrow USD 120,000 on the most favorable terms.
The lowest unemployment rate in history, constantly rising wages, employment stability and low-interest rates are factors that – according to data published by the Central Statistical Office – put Polish consumers in euphoria. We probably haven’t felt that way since 2007, and that makes us catch up on shopping arrears.
Consumers who want to do this on credit, however, must be careful, because its cost is affected not only by interest but also by commission, insurance or credit servicing costs. Which offers are therefore noteworthy? We checked using a specific example.
USD 120,000 paid back in 120 equal installments – we were looking for such offers. We asked the banks to prepare a calculation for a person whose monthly net income under the employment contract is USD 9,500. The list includes loan offers in which insurance is not compulsory.
We compared calculations prepared for external clients (who do not use the products of a given bank) and for internal clients (those who have had a personal account in a given bank for at least a year). The list includes those institutions which sent us offers until 30 May 2017.
How did we choose the best offer?
Regardless of the amount and repayment period, the offers available on the market should always be compared in terms of the most sensitive parameter, i.e. the total amount to be paid , and so we did.
In total, we compared the offers of nine banks. Our calculations have shown that the total amount to be paid can be from 174 989 to as much as 213 839 USD. Which means that by choosing an offer from the end of the rate, we will overpay almost USD 40,000, i.e. 1/3 of the borrowed amount. Details in the following tables.
Best offers for external customers
The loan on the best terms was offered by Good Finance. By borrowing USD 120,000, within 10 years our client would pay the bank a total of USD 174 989, and the monthly installment would charge his budget the amount of USD 1,458.24. Such costs were affected by interest accrued on the amount borrowed (at an interest rate of 6.99% per annum) and 3.5%. commission.
Good Finance presented a slightly more expensive offer. Here, the difference in the total amount to be paid compared to the offer that won our ranking reached USD 5 604.
The total amount to be paid at this bank was USD 180,593, and the monthly installment – USD 1,550.25. This result was affected by an interest rate of 7.99 percent. and 2.80 percent commission
Fine Bank was in third place. Unfortunately, the total amount to be paid at this bank was more than USD 16,803 more than Cooperative Bank’s offer.
The total amount to be paid at Fine Bank was USD 191,792, and the monthly installment was USD 1,589.27. This result was affected by an interest rate of 8.81 percent. and 6% commission
When preparing the list of offers for external clients, we compared a total of eight offers. The total loan amount for the product at the end of the rate reached USD 213,839.
Best offers for internal customers
In the case of offers for internal customers, Good Finance also proved to be unrivaled.
In the second and third position there was a slight reshuffle. The changes were due to Fine Bank, which offered its clients a loan with a total payment amount of USD 180,067 and a monthly installment of USD 1,500.56, thus outperforming the offer of Good Finance and taking second place.
Such costs were affected by 6.49 percent. interest rate and 9.90% commission. Interestingly, Fine Bank has prepared an offer only for internal customers.
Good Finance came third with the same offer as for external customers. Fine Bank fell to the fourth position.
When preparing the list of offers for internal customers, we compared a total of nine offers. The total loan amount for the offer at the end of the rate reached USD 213,839.
As we counted, a hasty credit decision can cost a lot – by borrowing USD 120,000 for 10 years, you can overpay almost USD 40,000. That is why, especially during the period of growing optimism, we encourage clients to be more vigilant and to carefully compare offers.