In addition, you can borrow both small and medium amounts of money, and the loan is easy to apply. To qualify for such a loan, the prospective borrower only has to meet a few requirements:
- Must be of legal age.
- Must be officially registered in the territory of the Republic of Latvia and actually live at this address.
- Must have a stable income, albeit small.
- There should be no violation of previous credit repayments.
- Must have a phone number and a checking account with any bank.
Quick loans help you deal with urgent cash problems, such as:
- You must pay your bill promptly.
- Not enough money until your next salary.
- Debt must be repaid in the short term.
There are many reasons to apply for a quick credit. In addition, such loans are perfectly legal and are issued by registered credit organizations. But it is with these types of loans that the borrower often overestimates his options: you seem to be paying off all your credit right away when you get your next paycheck, but by then you have expenses and needs, so you no longer have to repay all your debt straight away. Some simply ignore the rapid repayment of loans, which will have very negative consequences in the future.
Conscientious borrowers in these situations ask themselves: how to repay a loan if it has not been repaid in full, or how can you reduce the interest on the loan, thereby reducing the monthly payments?
In this article, we want to answer some of the most common questions about quick credit repayments.
Loan repayment delays
This option is most disadvantageous to the borrower, as if the creditor does not authorize the deferred payment and you, in your discretion, delay the repayment, it will not only lead to the repayment of the debt, but you will also have to pay any penalties for late repayment. Unfortunately, most borrowers who face financial problems most often do just that. And they do so simply because they do not know what to do to avoid calculating large fines. Already at the time of considering a credit offer, it is possible for any prospective borrower to know what amount will be charged to them for each day of credit delay. Such information can easily be found in the loan calculator of every popular Latvian creditor.
To better understand this, let’s consider an example:
- The amount of the fast credit is 300 USD.
- Loan repayment term – 35 days.
- Payment delay 20 days – 71.40 USD.
- The interest fee for using the loan is 57 USD.
- Total payment amount: 300 + 57 + 71, 40 = 428.40 USD.
On the basis of these figures, it can be concluded that the fine represents 23.8% of the amount of credit originally raised. In different situations, this percentage may vary depending on the amount of credit, the repayment term and the length of the delay.
Extend payment deadline
If you have already realized that you will not be able to return the loan on time, you always have the option of asking the creditor to defer payment. This period can be 5, 7, 14 or 30 days, and you may apply for such an extension countless times, but note that the annual rate for each deferred payment will increase, but the procedure itself will incur additional charges. But even with such extra expense, deferral often tends to be justified. Many borrowers easily pay off overdue debts at maturity. This option works when you clearly know that you will soon receive a large sum of money and that you will be able to pay off all your debts at once.
The fee for extending a loan is usually 15-30% of the total loan amount. Therefore, if you decide to apply for a credit of USD 200, in the event of an unexpected situation, you will have to pay USD 30-60 per procedure if you extend the due date.
In this regard, each creditor shall determine its own terms for the extension of the credit payment. The most loyal creditors allow you to pay interest on completing the extension date based on the amount of debt remaining.
It is important to think ahead with extending your credit repayment date, not when your bank has begun to charge you a penalty for late payment. If in doubt, call your lender and inquire about the consequences you may expect from a late payment.
Combining fast loans
If you have already processed several quick loans with different credit organizations and are unable to deal with their repayment now, the best option will be to apply for one large credit, which will allow you to cancel all previously drafted quick loans. Undoubtedly, a new loan will require additional expenses to get it, sometimes you will have to make a down payment, but as a result, the combined loan will cost you less than the lengthy repayment of several quick loans and the myriad payments to extend your due date.
For example: The borrower has made two quick loans via SMS. The first loan was issued for 100 USD, the second – 300 USD. Later, the borrower has ordered a 15-day extension of both loans.
- The first loan had an interest rate of 10%, so the borrower had to pay an additional 10 USD along with the total debt. As a result, the payment amount is 110 USD.
- The second loan had an interest rate of 12% and the borrower had to repay USD 336 (300 + 36) at maturity.
Along with the basic credit costs, the borrower had to pay 30 USD for the first loan extension and 50 USD for the second extension, so the total cost of both loans increased to 140 USD and 386 USD respectively.
It is in such cases that it is most useful to apply for a compound credit, but its amount should be equal only to the total value of the loans, taking into account the interest rate, not the overpayment on the repayment date.
Align with the ability of creditors to restructure their debt
Any credit institution will usually meet its borrowers and allow its clients to hope for a compromise solution at difficult times. Therefore, before deciding to extend your due date or allowing your payment to be delayed, contact your creditor’s representative and explain the situation.
Usually, when the lender finds that the borrower has difficulty repaying the loan, he starts to call and inquire about the situation with the loan. And at this stage, each bank chooses its own tactic for further action:
- Calling and threatening to include borrower in Single Debtor Register and go to court for debt recovery.
- Call and offer to meet to discuss installment repayment. In order for your creditor to offer you this scenario, you need to pay at least 1-2 times to extend your loan repayment date, and explain to the bank why you are no longer dealing with your debt.
- It should not be forgotten that it is not the creditor’s responsibility to look for a way out of your situation, but you have to offer ways to get your credit back on track.