Getting a loan means getting a new debt for a few years, but that won’t be a problem if you can meet your commitment. Here are five tips to help you avoid getting into debt when buying a car or a financed home.
Keeping bills on time, paying off funding, and having an emergency reserve should be part of planning to ensure the financial health of you and your family.
Don’t declare a higher income than you earn
Many people make this mistake! They try to prove a higher income than the person and end up getting a more expensive debt, with higher installments and interest than necessary. And hence debt can be generated over time by the inability to afford the financing costs.
Banks generally release loans with installments close to or equal to 30% of the applicant’s salary, a threshold for collection by law, and also an amount that should not generate debt, experts say.
Declaring a higher-than-true income can generate installments that occupy 40%, 50% of your salary, making it harder to pay them, as essential accounts often occupy the same budget range, which will squeeze your bills.
Compare rates for all financing options
Searching is always the best way to save! Compare all possible rates to get a financing with a lower interest rate, when the lower the rate, the cheaper it will come out. Fees can fluctuate greatly from one bank to another.
The tip is to do simulations on at least three or even five banks, if possible, analyze interest rates and if you have the openness try to negotiate an even cheaper rate with the bank. Lower interest rates no longer make long-term debt more expensive and can keep you out of debt in the future.
Give a part of the input value
Banks generally ask for an input X value before the financing installments. This amount is called the down payment and is deducted from the final financing amount. Always try to pay a higher amount than the bank asked for, hence your interest rates and installments will be lower.
You can use FGTS to do a home equity loan, for example. Selling your vacations or doing odd jobs or overtime at work is also a safe and fast way to get extra money to invest and secure cheaper financing.
Opt for financing rather than renting a house or flat
The rent is readjusted annually, in some cases even more than once during the year, which can tighten your personal budget. Already the trend of financing is just the opposite. The plots start at higher values and go down over time, which can settle into your financial structure and even break down to secure your own home.