It is not always easy to get the financial situation in order. Many Dutch people sometimes suffer from excessive costs that they end up in a vicious circle and keep filling gaps. This is very annoying since the research finances exert a considerable influence on human well-being. The vicious circle often arises when a large expenditure still has to be made over the fixed monthly charges or the costs are simply too high. In such cases, this can be easily resolved with the use of revolving credit.
What is revolving credit?
A revolving credit is a loan where you have a maximum spending limit. This means that you can determine yourself if and how much you borrow. Note that borrowing money costs money, so interest has to be paid on the loan amount. This interest depends on the institution with which you take out the revolving credit. When you use this, you can repay the borrowed amount in small steps every month. When you eventually need this money, you can just borrow it again! This way you prevent financial stress and you can use the money to leave the financial hassle behind.
What are the costs of revolving credit?
Borrowing money is not free and it won’t be anywhere. Even with DUO that provides loans for students from the government, it is not completely free. It is, however, obtainable from DUO at an extremely good interest rate. Namely 0.1%. You will not find this the moment you stop studying. If you want to use the revolving credit, you agree an interest rate with your lender. You pay this percentage on the loan amount. These percentages depend on your age and financial situation. These percentages generally range from 4 to 9 percent. For example, when you borrow an amount of 1000 USD, an interest rate of 9% means 90 USD. This is a fairly high percentage and amount. Therefore, the interest rate does not have to be paid off in one go by lenders. The monthly bill therefore consists of a part repayment and a part interest. That is why it is better to use this only when it is really needed and not to make it a structural way of financing.
Interim repayment with a revolving credit
When you borrow money it is of course nice if you can repay it as quickly as possible. That is why you can also make interim repayments with the revolving credit. There are no costs involved and that saves a lot. This means you are less likely to spend money on paper that is not yours and the interest rate will also increase less quickly! In addition, it is possible to borrow the repaid amount as soon as you need it again. This is the big advantage of the revolving credit. The duration is also not fixed, which is why it is continuous. So you can always use it as soon as you have paid it off.
Where can I find the cheapest interest rate for a revolving credit?
There are various agencies that provide ongoing credit. This can be banks, insurers and other commercial companies. There are a huge number of agencies that are only too happy to help you and therefore you often no longer see the forest for the trees. In addition, the interest rate is personal and is assessed per financial situation. So it takes a lot of time to visit all the different authorities to request this and see what the costs will be. There is one solution for this and that is making use of comparison sites. The institutions that provide the revolving credit are often affiliated with these websites and indicate their percentages for income and age categories. The comparison site only needs to know your age and income, and with that the search engine will find the cheapest interest rate for you. In the overview you will find different agencies with their interest rates from which you can make a choice.
Dangers of a comparison site when comparing revolving credit
Comparison sites are currently very popular as it can save a lot of time but also money. This is because the bodies that use the comparison site exert influence on the comparison site and make offers to overpower the competition. The comparison site therefore works on two sides. It ensures that you get a good overview of the best revolving lenders and often gives you a better deal than you can find on the regular websites. There is a danger here that not every website has to be independent. There are numerous agencies that have set up their own comparison site and compare products from competitors on it so that they themselves are the most advantageous and the choice falls upon them. When using a comparison site, it is therefore important to carefully check in advance whether it is really independent.