What is a personal loan?
What is a personal loan?
What is a personal loan? Requesting a loan is a very common solution to face unexpected expenses, financial emergencies, or other specific expenses that exceed your ability to pay at the moment. Personal loans are an easy alternative to obtain and without many procedures or requirements, to pay debts, buy assets or even travel. Here we tell you how they work and what their characteristics are.
What is a personal loan?
How does a personal loan work?
The bank gives you a fixed amount of money all at once, with the condition that you return the same amount in the medium term, adding the agreed interest. You can pay off your debt in a single payment or through periodic payments (installments).
To assess whether you are able to pay the requested amount, some banks use the credit scoring system, and based on your assessment, they determine whether they will give you a personal loan and at what interest rate. Depending on the credit history, the interest rates of personal loans can vary a lot, for the same reason, it is recommended to apply for a loan only when you are sure of your ability to pay.
Characteristics of a personal loan
- Most personal loans are requested for the purchase of consumer goods and services such as a car, a laptop, renovating the house, appliances, going on vacation, or studying abroad, They are also used to pay emergency expenses if necessary such as debt or medical expenses.
- Personal loans, unlike others such as mortgages or automobiles, do not require additional guarantees. That is, the debtor responds with his present and future assets.
- Generally, personal loans do not require a guarantee.
- To obtain a loan, you do not necessarily have to have a bank account.
- Usually, the amounts of personal credit are not so high, since the risk of non-payment is higher. Similarly, they are considerable amounts if we compare them with the credit that we can access with a credit card.
- They have 0 grant cost.
- The processing of personal loans is much faster than that of other credits, you can even do it 100% online.
Get to know the Personal Loans that BBVA has for you
What type of personal loans does BBVA offer you?
At BBVA we have different alternatives that you can choose from according to your needs:
- Personal Loans: Fixed Rate with a term of 6 to 60 months and a maximum amount of $14,000,000. I know more.
- Eco Loans: To acquire sustainable goods that contribute to caring for the environment. Learn more about this global trend.