Even if it sounds silly at first – a loan despite a minus in the account can be a very sensitive matter and help to get your finances under control again. After all, rescheduling the overdraft facility into an installment loan not only leads to a lower interest burden, but also to a reduction in bank debt due to the scheduled repayment.
Advantages of an installment loan
Many consumers recklessly use the overdraft facility that the bank gives them to their checking account for ongoing consumer spending without thinking about the consequences. It is then often no longer possible to repay this overdraft facility, so that high overdraft interest accrues every month. As a rule, interest is very high for an overdraft loan – interest rates of significantly more than ten percent are quite common.
If you use a loan in spite of a minus in your account to replace the overdraft facility, you can save a lot of money with the much cheaper interest rates. With such an installment loan, which is also referred to as a consumer loan, the loan amount is always repaid in the same amount in monthly payments. The customer can choose a term that enables him to conveniently service the loan.
It is therefore not a problem to replace a consumer loan over several months or possibly even years in order to be debt-free at the end of the term. In addition, it should not be forgotten that an installment loan, unlike an overdraft, cannot be canceled at any time. And the interest rate is also fixed throughout its term.
How to get an installment loan
Many house banks are willing to grant a loan despite a minus in the account, especially if it is to be used to reschedule the overdraft current account. However, no customer is forced to accept this loan offer if he is not convinced that it is advantageous. In fact, there are many online banks that offer consumer loans on very cheap terms. Because they have great cost advantages over branch banks because they do not have to maintain branches with a large workforce.
In order to find an installment loan with low interest rates, it is advisable to use an online loan comparison calculator, such as that offered on many financial portals on the Internet. There, users simply enter the desired loan amount and term, and then they are immediately presented with cheap loan offers.
Taking out such an online loan is completely uncomplicated: it can be applied for from the home computer on the homepage of the relevant bank. After approval, the Postident procedure is carried out in any post office with which the customer can be personally legitimized.
The online bank then transfers the loan to a customer-specified account. In this way, the overdraft facility can be conveniently redeemed. The repayment of the consumer loan usually begins immediately after the payment. Month by month, the installment payment brings customers a step closer to the goal of freedom from debt.