If you want to apply for a loan, you may be wondering how to minimize the monthly repayments burden. Long-term installment credits can be the ideal solution here. The long term reduces the amount of monthly installments and gives you more financial leeway.
What distinguishes installment loans with a long term?
Today, with many installment loans, you can not only set the loan amount, but also the term itself. Banks offer their installment loans for short maturities such as 6 or 12 months, but also for long maturities of up to 120 months. Many borrowers opt for installment loans with long maturities because it reduces the monthly repayment charge on the loan.
A loan with a long maturity is particularly suitable for high loan amounts. For a installment loan, the monthly installments are determined by the term and the loan amount. The interest is added. If one chooses a long loan term with a high loan amount, the monthly repayment rate remains low despite the high loan amount.
You can also apply for installment credits with long terms online. There are some direct and branch banks that offer loans for up to 120 months. Prerequisite for a installment loan are usually a permanent job with a regular income and a positive credit bureau information.
What should be considered for installment loans with a long maturity?
One should know that long-term installment credits often have the disadvantage that the interest rates are higher than with shorter maturities. This is especially true if the interest rate is calculated depending on the duration. For a long-term loan, interest rates will be higher than for shorter-term loans. In addition, you have to repay installment loans with a long maturity over many years.
However, as a rule, nobody knows what the future will bring, and whether one will be able to pay off the loan at the contractually agreed terms in the future as well. For this case, however, you can usually hedge. Who chooses a installment loan with a long term, should therefore think about a residual debt insurance.
Those who have already taken out a life and a disability insurance can usually – if these two insurances were chosen sufficiently high – renounce such a residual debt insurance. With a long-term installment loan, the default risk is much higher due to its long maturity than it is with shorter maturities.
Frequently, long-term installment loans are more expensive than shorter-term loans. Borrowers should accurately calculate in advance whether it is also possible to choose a short-term loan to save costs. If that is not possible, then you should make a credit comparison before deciding on a particular loan.
In a credit comparison loans are compared with the same duration and you can directly compare the interest rates and other conditions. Credit seekers can easily make it easy and make a free credit comparison on a comparison portal.
For this you simply enter the desired loan amount and the term and you will get suitable offers. So you can easily find low-interest installment loans with a long term and can fulfill a long-cherished wish.