The first loan is free, which is known to most of us, including advertising with the offer of Meybank addressed to new customers. It seems an interesting and at the same time a surprising proposition. Listening to the advertisements of this offer, probably more than one of you wondered what kind of parish have an interest in borrowing money for free. Certainly some of you also came to think that the first loan must have a catch for free.
How did it happen that the institutions known for providing horribly expensive loans introduced the offer, on which they do not earn? The first loan is not a free charity action, nor is a Christmas promotion. So what is it? What benefits does parabankes give you?
It is certainly the way in which loan companies want, or rather try to win new customers. Just as everyone almost knows the time limits, they know their high costs. Therefore, acquiring a new client is quite a challenge for every parabank. The cost associated with taking advantage of the delay effectively scares away the majority of potentially interested.
Ask why? Well, free loans are advertised as being completely free and that’s the way it is. You borrow, for example, € 1000 for 30 days and after the lapse of time, it returns exactly the same as it borrowed, that is € 1,000. However, this is not a problem. The trap lies in the fact that the parabank counts on the fact that the borrower will not be able to return the money after 30 days. What happens then? The customer is forced to use the repayment service for another period, e.g. 30 days, but he must pay a fee for this. These are not small amounts, since the parabolas usually use the same fees when renewing, as in the case of the next loan, i.e. high. Most often they are in the amount of interest resulting from a loan, i.e. if we borrowed € 1,500 for 30 days and interest amounted to € 450, the same will cost a prolongation. There are also offers, where the interest payments on the loan amount are applied for extending the repayment for another period. Such a fee in this case may amount to over 30%, i.e. with a loan of € 1000 for the extension of the refund period, we will pay over € 300.
Of course, you can not pay your debt at all, but it is associated with even higher costs. This is no way because the lender will take the case to court. As a result, subsequent costs of court and enforcement proceedings will follow.
With lower amounts of collected debts, we are not likely to face such situations, because we should pay back a few hundred zlotys without any problems. The problem can occur at higher sums. By borrowing, for example, € 2,000 per month, you need to be aware of the fact that in 30 days you will need to have 100% of the sum to return it. That is why it is so important to properly assess your abilities and not to borrow extensively.
Describing how the Meybank work, one word “how can not be done, how can I do it?” As you can see, the loan companies assumed that if it is difficult to get a customer interested in a loan under standard conditions, you need to find another way to get it. This is how the first loan offer was created for free. The client, who is encouraged by the lack of fees, borrows money for which he ultimately incurs the costs in the form of a payment for the prolongation of repayment for the next period. Therefore, it is safe to say that the first loan for free is a temporary trap.
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