There are times in life when we have to make expenditures for which we don’t immediately have the money. In the first place to buy, build or renovate our own house. But also e.g. to buy a car or replace a broken boiler. In that case you can get a quick loan from banks and credit intermediaries. Creditors may be willing to give you the money you are short of. You can then pay it back in instalments afterwards. In exchange for your loan, you will have to pay interest and costs.
There are different types of loans. As a private individual, they will offer you a mortgage loan or a consumer loan:
- A mortgage loan is an amount that you borrow for the purchase of a house, a building plot or for a renovation. A mortgage loan is often a larger amount and the repayment period is usually long;
- do you want to buy a car, a new television, organise a wedding and you need to borrow for this? In that case you can apply for a consumer credit. Such a loan is for rather smaller amounts that you repay in a shorter period of time (compared to a mortgage loan).
But do you really need a loan?
As soon as you think you need a loan, the first question you have to ask yourself is: do I really need that loan? What are my alternatives? If you dream of your own home, there is a good chance that you will take out a loan at 20 to 30 years for a large part of the total cost. This is the case for most new owners. It is especially important to know in advance what you are getting into and to estimate how you and your family will deal with the monthly repayment of this loan. Because that repayment can take a big bite out of your monthly budget.