The importance of financial literacy is always written. And not surprisingly, knowledge of finance is one of the most important and the most practical. Let’s take a look at the basic concepts of the loan agreement and cost of a quick online loan, which you should definitely pay attention to and where you should focus.
The money was not borrowed
It can be translated as a loan amount. It represents the amount of borrowed money or the amount you borrowed from the company. It does not include any interest or fees.
Interest rate and interest
The interest rate expresses how much of the principal you have to pay in addition to the financial institution that gave you the loan. It is most often stated as a percentage in one year (abbreviation pa). Using it, interest is calculated, which already represents the exact amount. Define it as a cash reward for money.
The fee is the monetary amount paid for providing the service. It covers the administrative costs incurred by a financial institution in providing and managing a loan. This means the costs incurred for the operation of the Client Center, the provision of advice and customer service, the infoline service, the correspondence with the client, and the like.
RPSN represents the total cost
The abbreviation of the RPSN was based on the initial letters of the concept R ocial P centric S of the N Bonds. It represents the percentage of the borrowed amount you have to pay extra in connection with the drawing of the loan. It is stated on an annual basis and covers all other credit-related payments, such as fees or insurance, in addition to interest. Its calculation further affects the total maturity of the loan, the repayment frequency and the fact that the compound interest rate is used in its calculation. RPSN is a mandatory feature to help you better compare the benefits of individual loans.
Monthly payment is a regular payment that you pay for your commitment to a financial institution. It consists of repayment of principal (interest), interest and possible service charges.
Each monthly installment has a specified date until when it is to be reimbursed. Most often, it is stated the day of the month that should be, for example: “Each installment is payable on the 5th of the month.” But beware, this date is the day when the amount must be credited to the account of the financial institution, not the day you will only be reimbursed.
If you do not pay your monthly installment on time, you will receive a reminder from the financial institution. By using it, the lender reminds you to pay the installment, otherwise, you will be charged with any contractual penalties and default interest. If you are currently in financial trouble and you do not have enough money to pay the installment, especially do not put your head in the sand and connect with the creditor as soon as possible. The sooner you start to solve the problem, the easier it will be. There is always a solution.
Contractual penalty, interest on late payment and reimbursement of expense
Once you find yourself in delay with your regular monthly installment, the lender is entitled to charge you, if agreed upon in the contract, a contractual fine and statutory interest on late payment. Both penalties are calculated from the amount owed. As companies always incur significant costs associated with your reminders, they may also charge you for the expense you have expensed. These include the cost of sending reminders, electronic SMS and MMS messaging, personnel costs, and so on. Charging these costs should always be reasonable and proportionate to the circumstances of your delay. If you do not know what to pay for the lender, do not hesitate to ask for a billing summary.