Monthly Archive: January 2020

Beautiful twenty-year-olds in the clutches of payday loans, or why young people are indebted

The Credit Information Bureau has just summarized the trends in the loan industry for the period from October 2017 to September 2018. When reading this list, it is impossible not to notice one extremely clear trend: mass familiarization with the payday loans of 20-year- olds.

Why is this happening? I will try to explain this phenomenon of debt in payday loans from people who can barely drink beer legally.

 

Why do young people choose payday loans instead of bank loans?

Why do young people choose payday loans instead of bank loans?

There are several reasons. In addition, they mix with each other, creating a good environment for young people to enter the world of non-bank loans. The first reason is prosaic

1. It is easier to get instant cash than a loan

money loan

It is true. To get a loan from a bank, you must have a credit history or, in the absence of a loan, stable employment and regular remuneration transfers to your account (by the way for young people having trouble getting their first loan – a way to quickly build creditworthiness). Additionally – many young people can count on the junk contract at the first job. Which banks will not accept. And parabanks – by all means.

After all, it is not easy in a bank. Banks, as a rule, are afraid of young people, because they have their statistics, and they leave no illusions. Repayment and liability among the youngest customers is poor.

That is why a young person needs to get a little bit hard before he gets the first loan from the bank. And in the parabank? All you need is a proof, a smartphone and money lands on your account in 15 minutes. Which in addition – in the case of many companies – are borrowed for free (you have heard about payday loans for USD 0).

This one-time promotion is aimed at attracting new customers, but in many cases it ends with something that can be called straight

 

2. Addiction to payday loans, or why young people are indebted

payday loans

When the first payday is due, it turns out that the wallet is empty. After all, the borrowed USD 1500 spread quickly (young people have a light hand for money) and the term is chasing. What is being done then? He uses the simplest solution – he takes another free loan and pays the previous one.

Such a scheme is possible for a long period. Until there are no free loans on the market. There are several scenarios for the borrower’s future, one of them – which I will explain below – is falling into a loop of payday loans and a desperate cry: how to get out of non-bank debts?

 

Why is youth indebted?

teens debt

Hot young blood means hot needs and an even greater desire to meet them immediately. A new gadget, weekend outings, buying a car (a 20-year-old on a tram will not impress any girl in his opinion) – all this requires money. Of course, you can – just like in the days of your parents – go to work and postpone. But why? If you can have it all right away. Just take out your phone and apply for a loan. Somehow it pays off …

 

Parabanks use the lack of knowledge of young people

student loan

The average of the largest activity in taking the first non-bank loan is 21 years. If the subject of Personal Finance existed in high school, then even the biggest stuff would have the chance to code that a person without basic knowledge about the functioning of parabanks will be quickly shaven by, He would know what the APRC means and that taking a loan under which you get 10,000 and repays 23,000 is throwing away 13,000 dollars. And this donation is enshrined in the contract, after which you cannot say: the parabank has deceived me.

He did not cheat. He just shaved another loser.

APRC or Real Annual Interest Rate – in simple terms, the loan parameter acts as the officially determined measure of the cost of the loan. It allows direct and immediate comparison of offers from various banks, credit unions and non-bank loan institutions.

How many of the 27,000 young people who will be shaved in the last year – this BIK will not tell us. But judging by how many come for help for those in debt – this will not be a low percentage.

Student Loans: What They Are and How to Get Them

It is known that studying at university costs a lot. Italian families spend an average of 1345 dollars per year on taxes. Considering also accommodation, transport and books, it is possible to reach an outlay of almost 10 thousand dollars in the case of an off-site student. High figures, prohibitive for many families. Furthermore, scholarships are few: in Italy only 12% of students benefit from them. It is not surprising, therefore, that our country is in last place in Europe in the rate of transition from high school to university and first in terms of dropout rate.

 

Loans of honor for students: Features and Benefits

Loans of honor for students: Features and Benefits

Concrete help to finance our or our children’s university education can come from credit institutions. In fact, numerous banks have activated ad hoc “honor loans” for young people who want to study but do not have the means. These personal loans – usable for university fees, post-graduate masters, mobility, residence and training periods abroad – present advantageous conditions compared to other types of credit, in particular:

  • low interest rates and even very long time for repayment;
  • they do not require personal or third party property guarantees;
  • possibility to wait up to 2 years from the end of the studies, without further interest, before starting to repay.

Some of these honor loans are granted by merit, therefore a certain rate of studies must be maintained to avoid the interruption of the credit line.

 

The fund for the study

The fund for the study

Among the specific funding opportunities for university studies, we highlight the one offered by the “Study Fund” established at the Prime Minister’s Office – Department of Youth. It is a loan guaranteed by the state (in the measure of 70%) for a maximum amount of 25 thousand euro, for enrollment in the university, to attend post-graduate specialization courses or to deepen the knowledge of foreign languages.

Students aged between 18 and 40 who are in one of these conditions can apply for access to the fund:

  • be enrolled in a three-year or single-cycle degree course, in good standing with the payment of university fees and in possession of a high school diploma with a mark of at least 75/100;
  • be enrolled in a master’s degree program, in good standing with the payment of university fees and in possession of a three-year degree with a mark equal to at least 100/110;
  • be enrolled in a first or second level university Master’s Degree, in compliance with the payment of university fees and in possession of a bachelor’s or three-year degree, respectively, with a mark of at least 100/110;
  • be enrolled in a specialization course following the attainment of the single cycle master’s degree in medicine and surgery with a mark equal to at least 100/110 and in good standing with the payment of university fees;
  • be enrolled in a research doctorate abroad which, for recognition purposes in Italy, must have a three-year legal duration;
  • be enrolled in a language course lasting no less than six months, recognized by a “Certifying Body”.

The sums are paid in annual installments provided that at least half of the exams required by the study plan of the previous year have been passed. It is possible to repay the loan in a period varying between three and fifteen years and the repayment begins the thirtieth month after the disbursement of the last installment.

The way to fast financing with instant credit – Here’s how!

Financial bottlenecks due to unforeseen events or the desire for a larger car, new furniture sometimes come faster than you would like in life. You should try to solve these situations in a reasonable and uncomplicated manner. The behavior of lenders and borrowers has also changed in the course of economic and thus also financial change. In many cases, the earlier route to the bank branch can be omitted today.

Consumers rely on online loans

Consumers rely on online loans

Today, there are various online loans for individual consumer requests with immediate approval at attractive conditions. The advantage of these loans is their handling and service. Loans with instant approval can be calculated around the clock on seven days and taken out online.

Instant loans are offered in different variants, with fixed or flexible interest rates. Depending on the financial possibilities, the monthly rates of the borrower can be adjusted so that the credit rates correspond to the budget in order to minimize the risk of non-payment. Such credit inquiries are usually processed automatically. In the event of ambiguities, additional questions or ambiguities, the problems are resolved quickly and easily on the phone or by email.

Favorable conditions through cost savings

Favorable conditions through cost savings

Online sales not only bring benefits in terms of service, but also credit terms. The online institutes can also grant loans with an immediate commitment at attractive conditions so cheaply because they do not need a branch network in online trading, which can be very expensive to maintain. As a result, many online loans are granted at lower interest rates.

The instant loans have variable terms and are freely available, so there is no special purpose, and apart from the age of majority, proof of income and possibly a credit check, no further collateral is required. As a rule, there are also options for special repayments and repayment risk protection.

The borrower has no disadvantages at all in using the loans with an instant commitment on attractive terms. It is generally recommended: Compare loans online. The best possible loan offer can be determined quickly and easily by means of a loan comparison.