When can you borrow without regret and will you not regret a loan taken out? If you pay too high interest. You think that makes sense. After all, you have carefully compared the interest rates. But unfortunately it is not that simple. Because sly lenders usually have some tricks to mislead you as a borrower and knock out extra money from the pocket. What’s up with that?
The insurance trick
Many large lenders only want to lend you money on the condition that you simultaneously take out a ‘purchase price insurance’ with them. This type of insurance ensures that you can meet your payment obligations at all times. Even if, for example, you are left without work. You will think that is a reassuring thought. In itself there is nothing wrong with such insurance. But there is one big adder under the grass: in most cases the insurance is way too expensive…
Many large donors are out to attract as many people as possible with low interest rates. In other words: the large letters. They later make up for the profit that they miss out on with the compulsory insurance. Indeed: the fine print.
In fact, many lenders are actually insurance sellers, you could say. The ‘benefits’ are clear: many people look no further than the interest rate. And when they hear about compulsory insurance, they are already thinking of the new car, or the beautiful new kitchen…
In addition to the insurance trick, many lenders have another way to earn some extra: selling additional financial services. You could say the ‘accessories’. How does that work?
Suppose you are applying for a loan from a lender that you had seen in the newspaper (let’s hope it is not one of the companies that uses the ‘insurance trick’). This insurance trick company checks whether you are well known at the Credit Registration Office (BKR). If that is the case, you are usually called for an appointment. The “adviser” can then explain everything properly. You go to his office or the “adviser” comes to your home. Everything is neatly arranged: the loan, the insurance, and – now that you are here – a share lease or savings policy. The “consultant”, who naturally works on a commission basis, is out to get you to sign as many signatures as possible as quickly as possible.
How do you borrow without regret?
- Don’t be fooled by cheap interest rates. First check whether you are required to take out insurance in addition to the loan. If this is the case, then you will be overpriced in most cases. So don’t.
- Is insurance not mandatory, but do you think it is necessary? Then be well advised on the types of insurance and decide which suits you best.
- If you take out insurance, make sure you have a favorable rate. In our site you will find the lowest rates that we have found.
- Don’t talk to “accessories” that you actually don’t have the money for, or whose financial risks you cannot properly estimate. For example, read our information about share lease.
- To get a good idea of the additional costs, we refer you to insurance comparisons, so you know whether you want to take out insurance. For the interest we refer to compare interest. We also invite you to find a cheaper percentage without purchasing premium insurance, we are convinced that this is not possible.
Now that you know these tricks, you have taken the first step towards borrowing without regret.