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Credit Card: Is it worth it with high values?

When we need to buy a high value item, is it worth using a credit card? If so, what are the advantages and disadvantages? Moneycom clarifies your doubts!

 

Evaluate Item Purchase

credit card

Is the value of the item really high? Is the installment payment worth it? Is it interest free? You need to evaluate all these points to see if your credit card purchase is really beneficial or if it is worth waiting a little longer to pay in cash.

 

The Credit Card Advantage

The Credit Card Advantage

The main advantage is safety, as you don’t have to walk the city streets with a large amount of money in your pocket. In addition, transactions with large amounts are confirmed by the credit company itself, most often at the time of purchase or days later. This occurs as a way to prevent fraud. Imagine if they used your credit card and you just had to pay the bill without purchasing the product?

 

The danger of revolving credit

The danger of revolving credit

Despite the main advantage, there is also an imminent danger when a long credit card installment is made: revolving interest (see more here ). In May 2016, the Lifecore Bank announced the record interest rate of this modality, which reached 449.1% per year! Therefore, plan to not have your monthly planning hampered.

 

Do not use excuses!

credit cards

Another advantage of the credit card, besides the immediate cash, is the loyalty program that the operators maintain with the customer, where the amount spent can be converted into bonuses, miles and even discounts. These advantages are unique and also make your eyes shine, however, they are no excuse for excessive and uncontrolled card use. So, don’t be fooled by seasonal offers. They may be temporary, but the debts that remain are not.

Remember : High-value purchases that your credit card company is not used to seeing on your statement should be informed in advance as it prevents them from being canceled.

Thinking of making a high value purchase but don’t want to use a credit card ? Why not consider taking a personal loan then? According to Moneycom, the Total Effective Cost (CET) can range from 2.79% to 5.26% per month, depending on the customer’s credit analysis and installment option.

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Personal Credit: 5 Things You Didn’t Know

Many talk about personal loan but few have knowledge about this product. Lendico has selected 5 things about personal credit that not everyone knows:

 

You are paying tax when taking personal credit

tax loan

Did you know that for any personal loan you take there is a tax that must be paid? This is what we call the Financial Operations Tax (IOF), it focuses on credit operations. But you are not paying this to the lender (bank or financial institutions), but to the government.

 

Can I pay in advance with a discount? Certainly!

Yes you can! This practice is actually called Early Settlement in the credit market. Remember if! Early settlement is a debtor’s right, defined by law. Every financial institution is required to do this if any client wants to pay off their debts before the deadline.

 

Having a clean name does not mean that you will secure loan approval.

loan approval.

That’s what a lot of people are wrong about, but having a clean name doesn’t mean you’ll get a loan. Keep in mind that each financial institution has its own credit rating method, evaluating a customer not only by clear name, but also by taking into account a number of other factors, such as payment history, income commitment, and others.

 

Your interest rate is directly related to your payment history.

One of the very important factors that all financial institutions take into consideration is the payment history. It is no use if you have a clean name, if the personal credit options available in the market are all very high interest rates. The key to getting a good interest rate in the market is to have a good repayment history. This means that if you pay all bills on time, without delays, there is a good chance of getting lower interest personal loans.

 

Advance deposit before getting loan is illegal!

Advance deposit before getting loan is illegal!

For those who didn’t know, any kind of advance deposit before getting loan is CRIME . Under no circumstances should the borrower make a deposit before he can receive personal credit. If you have suffered this from a financial institution, you can certainly report it.