Since you have to pay any fees for most things in this day and age, you should make an exact credit comparison for a loan without fees. It is not always the case that a loan without fees is also a cheaper loan than one with processing fees.
Since there is a lot of competition in lending at banks and other banks, they advertise that customers pay no processing fees and attract more and more customers. Today, the customers are attracted with all sorts of advertising measures, whether these then really promise that what is offered is often questionable.
Decisive for the costs is the APR, because it contains the interest and the processing fee. For example, if you pay 8.9% interest on a loan without a service charge, this loan is more expensive than if the interest were 6.5% and there would be an additional processing fee. So let’s calculate exactly, because a loan without fees is not automatically a cheaper credit.
Advantages of a loan without fees
If the bank does not charge a processing fee, it has the advantage for the borrower that he has not lost the full processing fees if the loan is repaid earlier. If a loan is replaced earlier, the interest will be back-calculated, but the processing fee would have been paid in full. For example, if a bank calculates a 3% processing fee on the loan amount, it would definitely have that amount no matter how short-term you would pay off the loan. The greatest opportunity to find a loan without fees and low interest rates is to search the direct banks on the Internet.
These online loan offers are very often without processing fees. With the different on-line banks one has also well the possibility to compare different loans, without being immediately surprised by a bank employee or zugelabert. On the internet you can set your own priorities and calculate and display different variants. Many normal “banks” also have to do with any online banks and if they are behind the bank name still directly. These banks can usually work more cheaply, because much over the Internet runs and thus personnel, paper and long ways can be saved.
Even with a loan without fees you must be able to prove a positive credit rating, otherwise you will hardly have a chance with a reputable provider. So you need a regular income, not so many negative entries in the credit bureau, even better, of course, no entries and maybe even a security deposit, depending on how the credit check fails. The complexity of the credit check also depends on the amount of the desired loan without fees.
Sample calculation of a bank
Would the borrowers z. For example, a loan amount of 5,000 USD and a contract period of 12 months, many customers of this sample bank receive an annual percentage rate of 2.90% or even better (fixed borrowing rate 2.86%, processing fee of the sample bank would be 0.0% and the Interest costs: 77.85 USD).