Credit tells us all. Small credit occasionally creates confusion. What is that, actually? Who gets it And what are the advantages? EarnAny Finance sheds light on the dark.
What is a small loan?
With a small loan, you are dealing with an ordinary installment loan. You pay back the loan amount in regular installments. The only two differences:
- The small loan runs over a comparatively low amount, for example between 500 and 5,000 dollars.
- The small loan has a relatively short term.
Because of the low sums and short terms, the small loan is aimed specifically at smaller investments such as new furniture, electrical appliances or a long-awaited long-distance trip. Occasionally, consumers also use it as an alternative to expensive overdraft facilities.
Small Loans vs. Mini credit – what’s the difference?
It is not uncommon for small loans to be mistaken for mini loans – wrongly. The two terms are not to be understood as synonymous. Rather, mini credit is a special form of small loan. The consumer takes in a mini sum. Usually it only moves in the three-digit range. The particularities:
- The application process is straightforward. Often you don’t even have to provide proof of salary.
- Speed also plays a role: occasionally you get the mini loan as an instant loan. You will have the loan amount in your account just a few days after submitting the application.
- In addition, the extremely short terms differ from small loans. You will have paid your debt in 15, 30 or 60 days.
What are the advantages of small loans?
Since the small loan is only tied to small loan amounts, you can repay it in full within a short time. Although some banks give you a leeway of up to 84 months, you can also pay off the loan amount much earlier if you wish.
Twelve to 24 months are realistic. The fast repayment pays off, especially for holiday loans. If the next trip is imminent in the coming year, the loan is already paid off in full. You can enjoy your vacation to the fullest.
Little financial pressure
Every loan is a small financial hurdle – some more, some less. The latter is the case with small loans. Thanks to the low monthly rate, you won’t get into trouble so quickly.
Let’s assume that you take out a vacation loan of USD 2,000. You choose a term of twelve months. That means a monthly charge of around USD 170. You leave yourself even more freedom with a longer term. If you want to repay the amount in 18 months, you have to plan around USD 86 per month for the repayment.
Short terms are also attractive for lenders because of the lower risk and this also affects the conditions: Small loans can be acquired from an interest rate of 4.5%. – at EarnAny Finance for example.
Quickly applied for, quickly approved
Anyone who applies for a loan has to be patient: do I get it or do I not get it? With small loans, however, the waiting is limited. The small sums are quickly approved.
Good prospects for low earners
Even low-income earners have high chances of success with small loans.
Good alternative to overdrafts
Those who want an instant loan usually use the overdraft facility. But do not rush anything: Small loans are often the better choice because the overdraft rates are significantly higher than the rates for small loans.
What you spend your money on is up to you. But it is different with credit. You disclose your purchase project. With small loans, on the other hand, this is often not necessary; the banks do not necessarily stipulate a purpose.
What are the requirements for a small loan?
Although it is only a small loan, the bank cannot refrain from checking the credit. To be able to prepare a household bill, you need to know two things:
- the monthly earnings
- the monthly expenses
Of course, the test must be positive: The applicant must be able to manage the desired loan amount from their own income. Most credit institutions require income from employment that they can verify with proof of salary.
Your checklist for small loans
The ideal profile:
- Permanent residence in Switzerland
- Im has a Sideways Bank account
- Regular income
- Monthly installments can be easily paid with your salary
- debt free
If you can put a check mark behind every point, there is nothing to be said against a small loan.
Safety tips for small loans
- Planning with foresight: Not all expenses can be calculated. All the more important is a financial cushion for financial surprises.
- Plan realistically: think about your maximum monthly rate. What is the maximum you can pay? Offers that are above this should be enjoyed with caution.
- Do not stack too deep: the lower the monthly rate, the greater the relief? Not necessarily: because the lower the rate, the longer the term. And the longer the term, the higher the interest.
What documents do I have to submit for a small loan?
Of course you have to provide your information – especially your monthly income. Either you provide a certificate of earnings or the bank statements of the last three months – the pension notice also provides information about your financial situation.
But small wages are not the only thing that matters. Banks often secure themselves with proof of permanent employment. However, the self-employed and freelancers are not disadvantaged: You can prove your income with the tax assessment.
When will the small loan be paid out to me?
When it comes to disbursement, small loans play their trump card: Unlike with large loan amounts, you get the comparatively low credit after just a few days.
And this is how you have to imagine the process: You send your documents to the lender who carries out a credit check. If this is positive, the approved loan amount will be transferred to your account immediately after 14 days.
Expert tip: The payment works even faster if you process the loan entirely online with a digital provider – the special thing: Since you upload your documents directly to the homepage of the desired credit institution, you save yourself the postal service. Online processing is a good choice for hurried applicants.
How much do I have to plan for a small loan?
There is in general answer to how much small loans cost. Too many different factors influence the amount – from the loan amount to the term to the interest rate. It is not for nothing that most consumers want an expert by their side before signing a contract – someone like EarnAny Finance. Our credit specialists know what is important when calculating the loan amount and are there to advise you.
What is a small loan suitable for?
Small loans make a variety of dreams come true. These are particularly common here:
- Vacation: Have you always wanted to experience the “Indian Summer” in Canada? Do you want to get a taste of New York City next year? The pearl-white Caribbean sandy beaches are a childhood dream? Small loans make long-cherished vacation wishes come true. The financial subsidy is more than convenient for expensive long-distance trips. Either you finance the whole trip with it or just improve the holiday fund.
- Used cars: your age is slowly giving up the ghost? Then it is high time for a new one. With the used car you do not only do yourself in favor, but also the bank. After all, the car is a valuable asset that gives it safety.
- Furnishing: Your apartment could use a breath of fresh air? It’s just a shame that this fresh wind is pretty expensive. Many furniture stores lure with installment payments and 0% financing. However, it is not uncommon for the loss in the furniture price to be felt. But you don’t have to do without the new furniture. With a small loan you breathe new life into your apartment.
Who gets a small loan?
Small loans are accessible to everyone: Even applicants with low or irregular incomes have chances of getting a small loan. The chances are good, especially for freelancers and self-employed people who can show regular income.
The same applies to pensioners and students. The prerequisite is again creditworthiness, a regular income. As soon as you can present this together with a positive ZEK information, there is nothing to be said against borrowing. As proof, banks accept certificates of earnings from the student job or the pension notification.
Even unemployed people are not generally denied borrowing: those who have a second borrower or guarantor on their side increase their chances of getting a loan.
Looking for a small loan? Found at EarnAny Finance
Did you fall in love with a piece of furniture? This used car is made for you? Next year should it be the long-distance trip? Only one step separates you from your big dream – the right small loan.
But the search is over. With EarnAny Finance, your Swiss loan expert, you have already found your partner. But what makes us so special? Here are the benefits of our online loan at a glance:
- flexible loan terms between six and 84 months
- freely selectable loan amount between 1,000 and 120,000 dollars
- attractive interest rate between 4.5% and 9.9%
- Flexible deadlines: If you wish, you can pay off your small loans earlier – without any additional costs.
- High insurance protection: Secure your rates against unemployment or unemployment.
- 14 days right of withdrawal: You can withdraw from the contract within 14 days after signing the contract – at no cost.