The different forms of consumer credit
The bank overdraft authorization must be accepted by your bank, only it can, when the balance of your account is not creditor, to authorize it. It thus makes it possible to cope with a debit on account, a shift in cash or an anticipated use of a cash flow that is expected.
Bank Overdraft is a type of credit that requires prior approval from your bank. This is why it is considered a consumer credit. Its amount and interest rates are negotiated when opening a bank account. It is very useful to avoid payment incidents but is still much more expensive than a conventional consumer credit.
What is an assigned credit?
An appropriated appropriation is granted for the purchase of movable property (eg car loan) or a defined benefit (works credit). The latter is offered by the seller of a good or service, in partnership with a financial institution. This credit is not always the most advantageous. Granted for a period of more than three months, the amount of an appropriated appropriation must be less than $ 21,500.
With an assigned credit, there is a link between credit and sales agreements. Your repayment obligations to the bank will not begin at the time of signing the loan but from the delivery of the property. When an assigned credit, in case of defects or non-delivery, you can suspend the repayment of monthly payments, which is not the case with a conventional personal credit.
What is a free credit or zero rate credit?
The free credit is a consumer credit that is regulated to protect the consumer tempted by the term “free”. This zero rate credit is offered by the seller of a good or service, to encourage you to buy, without necessarily having the financial resources available. The free credit is a refundable credit without interest payments. Its duration is often limited to three months. However, free credit can cause some people to become increasingly indebted.
What is Lease with Purchase Option (or LOA)?
Lease with Purchase Option, sometimes called “leasing”, is a formula that consists for the lender to buy a property on behalf of the consumer, and then to rent this property (motor vehicle, boat, computer equipment). The lease with option to purchase has an average duration of 3 to 5 years.
What is a student loan?
A student loan is a consumer credit that helps finance his studies. The first period, lasting from 2 to 5 years, covers studies during which the student pays only insurance or insurance and interest and the second covers the period after studies where The student must pay the capital and interest if this has not been done. The amount of the student loan varies with the studies that are pursued by the student. The maximum total duration is 9 years.