On what occasions to consider borrowing from a non-bank lender? On what occasions not to borrow from a non-bank lender? What to do in case of issues?
On what occasions to consider borrowing from a non-bank lender?
Short-term loans are meant to be used for emergency expenses, for example, when a domestic appliance breaks down unexpectedly and needs immediate repair. Although the service is easy and convenient, one must use it responsibly and sensibly. Before taking out a short-term loan, a person should evaluate the real necessity for this money; their ability to repay in a timely manner; make sure they do not borrow more than it is necessary. If you have decided to take out a short-term loan, make sure you are fine with the set interest rate (commission), have studied the terms of the agreement carefully, keep track of your budget to repay the loan on due date.
On what occasions not to borrow from a non-bank lender?
Short-term loans are not to be used to solve long-term financial problems. Also, they must not be used to repay other loans, such as mortgages, leasing, and the like. Finally, they are not a quick-fix solution for spontaneous whims.
What to do in case of issues?
If a client is in difficulty and is unable to meet their obligations, industry companies are calling on the creditor to seek a solution together. Industry companies invite clients in difficulty to act calmly and prudently:
- Under no circumstances should the client borrow from other creditors to repay an existing debt
- The client should contact their service provider to find the best solution to the problem
- The client should not delay the problem – the longer the client hesitates, the more difficult it will be to resolve the situation
- The client should revise their budget – there may be spending items that can be abandoned or substantially reduced
- If, however, the client does not see a way to deal with the situation, seek advice from the Alternative Financial Services Association.