Tends to see a confusion about what is credit and loan, we treat it as if they were the same thing, the reality is that they have different characteristics.
Although in both cases it allows us to get out of payment of unexpected debts, some emergency or leave the payment of acquisition of goods, but everything in its own way. So let’s start with the basic concepts of loan and credit.
Loans are granted in full at the time the application is accepted
The lender or financial institution offers a certain amount of money that the applicant agrees to pay along with the interest that corresponds. The payment of the debt is made through regular fixed installments, which are agreed in advance.
The credit on your part is the money that is made available to a customer, not delivered once but as you need it is released, without exceeding the limit, when the customer considers it convenient to use and is not forced to spend everything. The interest is calculated based on the money that is worth either the merchandise, a good or a credit card or account, deposed by the customer this is called amount.
What is my best option?
The circumstances can determine a large part of this decision, the speed, the amount, the possibility of paying the debt among others, you can make this decision based on the differences.
- The credit offers you the total sum fractured, or that, in parts. The loan gives you all the money in a single transaction.
- The expiration date can be renewed with the credits, in the loans you must liquidate everything in the agreed time.
- The loans are used to pay for the purchase of an asset, such as a car or your studies, while the credit works for more temporary things that you have to face when you do not have liquidity, it can be used for companies as well.
- The interest is higher in the credits but you only pay the interest of what you have used, that is, if you use little money from the credit the rates are not excessive.
- The credits can be renewed, even about 3 times.
Request money to find solutions is something more common than you think
Money does not pay to everyone the same because everyone acquires different responsibilities and these accounts with different measures. Loans or credits can save us from a bad situation but if you look at their differences you will be able to choose something more according to your needs, not only when solving a crisis, but to pay later. This way you will not generate a sum of unnecessary problems, but you can solve the urgency and responsibility acquired.