The answer to the question whether it is worth taking a loan, not only for renovation, but for anything, is very difficult. It is known that it will be better and more profitable for our portfolio if instead of getting a loan, we will first save the amount we need and then spend it on what we need. Repayment of the loan is inverted saving – if we wanted to spend USD 5,000 on renovation and in a month we could spend USD 500 on it, then after 10 months we could proceed to renovation.
With loans, we always overpay less than with loans from non-bank companies, but this is due to a greater number of formalities and the fact that banks do not accept negative credit history and outstanding and unpaid debts. If we have any arrears, the only thing we can use are loans without credit check. We will be cleared away in all other places.
How to get a loan for renovation?
Obtaining a loan for renovation involves the necessity to undergo standard banking procedures related to granting a loan. The instruction we give is quite universal, because all banking entities carry out the credit process in a similar way. Importantly, all the offers in our ranking are cash loans, which is why we will describe how to receive this type of financing.
First of all, we must first review and compare the various offers. You can use a ranking like ours. We should be primarily interested in the maximum amount that can be received at a given bank and the APRC, i.e. the interest rate on the loan.
After choosing the most convenient offer, we proceed to submitting the application. If we choose an offer from our ranking, it will be a very simple process – we do not have to look for offers on specific banks’ website, we just click the ‘submit application’ button and we are automatically transferred to the appropriate page.
Completing the application normally looks the same. We give in it:
– personal data,
– residence / domicile address,
– number of our dependents,
– monthly cost of living, including regular rent, electricity, water and gas,
– loan amount,
– preferred repayment period,
– the amount of our income,
– type employment (employment contract, work contract, work contract) or source of money collection (e.g. retirement, 500 plus, disability pension, allowance),
– information on financial liabilities (loan installments, maintenance).
We must complete the application carefully and pay attention to any errors or typos. Only on the basis of the correct data provided by us will the banking system be able to examine our creditworthiness and credit history.
We are only one step away from submitting the application for payment – we have to wait for the credit decision and then sign the contract. The money will be credited to your account the same day or at most on the next business day (the day will only be delayed if we have an account at a bank other than our lender). However, if we are the clients of the same bank where we take the loan, the money will reach our account in a few seconds.
How to get a loan for renovation?
Getting a renovation loan is much faster than getting a loan. The request requires us to provide less data and information about our financial obligations. Most loan companies do not require proof of income. What is important – we do not have to tell the lender (or write it on the loan application) for what exactly we want to borrow money.
A renovation loan is really three simple steps:
1. Choice of installments and repayment period.
2. Filling out the loan application.
3. Waiting for a decision and payment of money.
Our loans are usually verified by means of a verification transfer for a symbolic amount of USD 0.1 or USD 1.00. It is very important that the transfer is made from our individual and private account – it cannot be a joint account with a spouse, partner, parent or bystander account. Sending this transfer is not meant for us to pay something to the loan company, but for it to be able to determine whether we are the person we claim to be (evidence of being able to log in to your own bank account and send a transfer from it).
You will need a valid ID card to use loans for renovation. Without it, we have no chance even to submit a loan / credit application. In addition, we will need:
– own telephone number,
– email address.
For non-bank loans, the list of required documents usually ends. Banks require a lot more documents. In particular, in the bank we must show documents that confirm our revenues, and therefore, for example:
– an employment contract or bank statement confirming our earnings,
– a statement from the Tax
Office on income (if you run your own business), – a certificate about the pension you receive.
We can be released from this obligation only when we take a loan in the same bank where we have the account (then the bank “sees” the inflows to our account and examines them on its own).