personal payday loan is a particularly flexible financing solution that makes it easy to finance projects. But is it possible to take advantage of this flexibility and simplicity for projects requiring long-term financing?
How does the personal payday loan work in terms of duration?
personal payday loan for consumption, the personal payday loan allows a maximum loan amount of 75,000 euros with a repayment period spread between 3 months and 7 years. Generally, a personal payday loan makes it possible to finance projects, be it goods (a vehicle, a television…) or services (a trip, the accommodation costs of the student children…).
Of course, the longer the repayment period, the higher the cost of credit. This is so because of the risk taking suffered by the credit institution. It is therefore advisable to choose as far as possible a relatively short repayment period if we want to avoid a high cost of credit.
Choose the optimal duration of the personal payday loan
Of course, the borrower does not decide by himself the duration of the repayment. This decision is made in consultation with the lender that will have the last word on the issue. In concrete terms, the length of repayment will depend on various factors such as repayment and debt capacity, or the will of the institution. It should be noted that in exceptional cases such as home financing, the lending institution may, under certain conditions, extend the repayment term up to 120 months.
But in general, the lending institutions offer repayment conditions determined according to the desired project. For example, the repayment period will generally be less than 48 months for the financing of a used vehicle, and may be up to 72 months for the financing of a new vehicle. This same duration is often recommended for the purchase of furniture or computer devices or household electrical products.
The need to be well informed before committing to a personal payday loan
Be that as it may, the use of a personal payday loan implies that it can be repaid within the time limits stipulated by the contract. It is important to find the right balance between current and future debt levels.
It will be understood that a rapid repayment period has the advantage of reducing the cost of credit, but implies a significant financial effort in the short term. Conversely, a repayment over the long term reduces the monthly amount of monthly payments, but has a high financial cost.