Loan and Financing: These are two terms that are widely used in the financial world, but many people still have doubts about the ideal way to realize a dream or project. Understand what the differences are and which option is best for you.
Keeping your bills up to date or investing in that dream project may require extra financial help. At such times, looking for a credit alternative may be a good option to turn your project into reality. But between loan and financing, which is the best option?
To help you choose, let’s explain what each sport offers and how you can find out which one best fits your needs.
What is loan?
In the loan, the bank or a banking institution offers a value to a customer . To repay this amount, the lender charges an interest rate , which is defined by the risk of default, ie the possibility of the customer not paying the amount back.
Therefore, when a guarantee is presented in the transaction, interest becomes lower . Real estate and automobiles are some examples of collateral that can be presented in loan transactions.
The loan is usually unrestricted , so there is no need to prove to the bank or financial institutions what the purpose of the loan is .
At Bigcredi, you can find home secured credit, where the customer presents their own property as a guarantee that they will pay back the loan . We release amounts between $ 50,000 to $ 2 million , with rates from 0.99% per month, and the payment term is up to 180 months .
What is financing?
Financing is also a type of credit , but it is granted for specific purposes , such as buying a property, for example. Thus, the consumer needs to prove the use of money to the bank or financial institution , which tends to make the operation more bureaucratic.
The best known financings are real estate and vehicles . Just like in the loan, the lending institution charges an interest rate that is usually lower because the amount given is intended for the purchase of a good.
Those who do not have enough money to buy a property or car can resort to financing. Thus, the lending institution pays the missing amount and the customer pays the amount in installments, along with the interest rates.
Bigcredi works with real estate financing, with values between $50 thousand and $1.5 million , with rates starting at 1% per month + IGP-M . It is possible to contract a financing of up to 70% of the value of the property , and the FGTS can be used as input, following the rules of operation.
What to choose: loan or financing?
The main difference between loan and financing is precisely the use of money . If you need credit and your priority is free use of credit, the best alternative is to take out a loan. But if the use is specific to buying property such as real estate or automobiles, financing may be your best option.
Secured Loan or Real Estate Financing: Which Is Ideal?
Within the mortgage, there are two modalities: the secured loan and the mortgage .
Those who already own their property may have access to a healthier loan, as providing a real security as a property reduces interest rates and allows the repayment term to be lengthened. This combination significantly reduces the value of the monthly installment, compromising less income on debt repayment.
Who wants to buy their own property and does not have the full value , can make the purchase with real estate financing. With lower interest rates, it is easier to achieve the dream of home ownership.
And which do you fit into which of the two uses? Make a simulation with Bigcredi and get access to the best credit conditions with collateral and mortgage.