Installment offers are now bombarding consumers on a daily basis. Appliances, cars, furniture are just some of the apparently easy and affordable goods to buy. With a small monthly payment, perhaps starting to pay after a few months, we can immediately take home a very modern smartphone. The offers really seem very convenient: instead of paying demanding amounts immediately, we can reduce the outlay to a few tens of euros a month.
In this way everything seems accessible, indeed so we find that we can afford even the most expensive model. But is it really so? In short, you buy television in installments but how much does it really cost you? We reveal the deception of the zero rate and the secrets of financial companies. In this article we will discover what lies behind the financial offers and the risks associated with easy credit. Too many installments can become an unsustainable burden for families, we talked about the suicide-saving law in a recent study.
The chimera of the zero rate
Let’s dispel a myth: no bank or financial institution will ever lend money without making a profit. In fact, when an institution provides a loan, it must bear a series of costs. It must also foresee the risk of non-payment of installments by customers. The interest and commissions applied to the loans are used to pay these charges and to guarantee a profit to the financial company.
For these reasons, the zero rate cannot exist. But the financial proposals seem to say the opposite. With a zero-interest loan we can buy a television worth 1,000 euros in 10 installments of 100 euros each. Where is the deception? The finance company will actually make us sign an interest-free contract, but will pay the merchant an amount lower than that indicated in the shop. In short, we are buying a TV that is worth less than what was proposed to us. At least it is not possible to know, since the contracts are intentionally misleading.
You buy television in installments but how much does it really cost you? We reveal the deception of the zero rate
Having escaped the danger of zero interest, we will always be able to take out a normal loan. The rates offered are often very affordable, at least apparently. The game is played on the difference between TAN and APR. These two acronyms are essential: the first indicates the cost of money. At this moment it is very low and in fact, the TAN is usually the most advertised parameter.
The APR instead, it is the actual cost that the consumer will pay. This item also includes additional taxes, policies and guarantees of often doubtful utility. It is not uncommon to come across loan offers with a TAN of less than 1% and an APR close to 10%. This TV will therefore cost us 10% more than its price. We also need to remember that offers are often prepackaged. It will not be possible to avoid a policy that covers the financial from the risks associated with our work. Even if we are perhaps public employees or retirees, and we do not run the risk of employment.
How much is your privacy worth?
Once the loan agreement has been studied and deemed that the proposed conditions are clear and convenient, we will have to sign the relevant forms. Often this operation takes place in the confusion of a shopping center with the rush to go home with our new TV. Instead, it is essential to take the time to carefully read the conditions, in particular the privacy agreements. Very often, with the contract we authorize the financial company to contact us again to offer us other loans, policies or other services. This is not a secondary aspect because sometimes these calls can be very annoying.
In summary, our TV can cost us an indefinite price in the case of the zero rate. Or, with traditional financing, we will pay a certain rate and have sold our privacy. This will involve phone calls and communications with promotions that we will always have to carefully evaluate. ProiezionidiBorsa staff invites readers to carefully read the contractual conditions and evaluate the actual value of the goods to be purchased.
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