What is a low interest personal loan?

✅What is a low interest personal loan? ✅What are their characteristics? ✅Regulation of personal loans with low interest
What is a low interest personal loan?

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When it comes to financing purchases of a good or service, many speak of requesting a consumer credit. The question is, do you know what they mean? If not, here we tell you what it is, what its characteristics are and how to process it.

Since it is one of the most requested financial products, personal loans with low interest offers do not stop appearing. For this reason, at Moneytochka.com we compare the best options on the market, with online finance companies that grant consumer credit under more favorable conditions than those of banks and other entities.

Through these offers, you can obtain credit with a single click and finance your purchases or projects easily and instantly.

What is a low interest personal loan?

Personal loan is a financial product that is intended for the purchase of goods or services. This type of financing can be granted by banks and finance companies, and with it you can pay for the purchase of a car or an appliance, a home renovation, finance a mobile phone and even a trip.

According to the Bank of Philippines, consumer loans correspond to a category within personal loans, through which a lender grants a certain amount of money to a borrower, who agrees to repay said amount together with the corresponding interest.

Since most personal loans are intended for the purchase of goods and services, they are usually seen as personal loans with low interest.

What are their characteristics?

Now that you know what a personal loan is, let's see what the main characteristics of this financial product are.

  • It is intended for the purchase of consumer goods and services.
  • Its amount is not as high as that of home equity loans.
  • It is processed faster than other types of loans but usually has higher interest rates.
  • The borrower responds with his present and future assets, so the lender evaluates his creditworthiness through proof of income.
  • The client is protected by law, so they have the right to receive detailed information on the Annual Equivalent Rate.

Regulation of personal loans with low interest

Like any reliable financial product, consumer credit operates under consumer protection. 

Likewise, the law  in the Philippines includes the following rights for the consumer:

  • Right to complete pre-contractual information, including interest, commissions, links, duration and other credit conditions.
  • Early repayment option so that you can repay the entire loan before the agreed term expires.
  • Right to a binding offer, in case you so wish.
  • Possibility of withdrawal without any commission, within 14 days of signing the contract.

Types of personal loans

In the Philippines there are 3 types of consumer credit that you can request depending on your needs as a personal, and these are:

  1. Personal loans
    This is the most common type of consumer credit, which commits a borrower to return an amount of money to the lender, along with the agreed interest and in the agreed time. This modality is also known as installment loans, as they grant large amounts from approximately 500 PhP to 50,000 PhP , to be repaid in terms of 1 to 2 years or more.
    The repayment of these credits is carried out through fixed monthly installments that are calculated based on the amount and term chosen.
  2. Quick microcredits
    Another of the most requested consumer credits are online microcredits. These consist of Small loans of up to 5,000 pesos that must be repaid in the short term, almost always within 30 days.
    Basically, they are the easiest and fastest type of consumer credit to process. Because they are low amounts, they do not require paperwork or explanations unnecessary and are approved in a few minutes.
    In addition, it is often possible to obtain a first loan without interest, as long as you are a new client.
  3. Revolving credits
    Lastly, we find revolving credits, also known as lines of credit. This type of financing allows you to have a certain amount of money whenever you need it, without having to sign a contract each time.
    In general, it is usually granted through credit cards, which are considered the star product to finance purchases or urgent expenses.

Requirements to apply for personal loans with low interest

Usually, the requirements to apply for a consumer loan at a bank are many and very complicated. Fortunately, to request an online consumer loan you do not need much, just meet some basic requirements such as:

  • Being over 18 years old (in some cases you must be over 21 or 25 years old).
  • Reside in the Philippines.
  • Have a valid SSS.
  • Demonstrate solvency.
  • Have an email and a mobile phone number.

You must bear in mind that these requirements may vary according to the entity and the type of credit. Thus, in addition to these conditions, some entities may request additional requirements.

For that reason, we recommend that you pre-evaluate each lender's offer to make sure you qualify as a potential applicant.

How to process an online consumer credit?

Through the online finance companies that we recommend, you can apply for consumer loans quickly and without leaving home. Doing so is very easy, you just have to follow these steps:

  1. Choose one of the consumer credit offers from our ranking and click on "GET LOAN".
  2. From the lender's website, enter the amount and repayment term in the loan simulator.
  3. Next, complete the application form with your personal and bank details.
  4. You will receive a consumer credit agreement with detailed information about your loan. Read it carefully and sign if you agree.
  5. Finally, the entity will transfer the funds to your bank account and you will be able to dispose of the money in 15 minutes or in maximum 48 hours, depending on your bank.

If you want to find the best aplications loans in Philippines you may find it on our site MONEYTOCHKA.

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