Purchases In Installments – Is It Worth It? Deposits, Bank Accounts
Everyone who bought at least once furniture or household appliances – RTV, and probably everyone did, is well aware that the prices of these products are very high. They often exceed our monthly salaries several times. And as you know, we must have them in our home, because it is difficult to imagine our lives without a sofa, TV or fridge.
So how do you buy such expensive products? We have at least three ways to do it. First of all, we can save and after some time, when we put down the right amount, we will buy our dream product. Secondly, we can borrow money for a purchase from a bank, credit unions or a private person. And thirdly, we can make a purchase in installments. Is this a viable option? Let’s analyze it.
Purchase in installments is nothing but borrowing money through the store in which we make purchases. Money is usually borrowed from a bank that has an appropriate contract with the store. Of course, the bank will check our creditworthiness through the store, however, the requirements in this respect are quite liberal and often those who can not get a cash loan in the bank, can make purchases in installments. So we have one plus of such purchases. Another is the fact that stores usually offer installments at no cost. We simply pay for the goods in installments, but we do not have to pay any interest or commission. Someone may wonder what store or bank the business has. First of all, the store sells a product for which the bank often transfers money immediately. On the other hand, banks, when granting a loan, have a chance to gain a client, who in the future may propose another, already paid loan. The third plus of installment purchases is the ability to build or improve our credit history. Each purchase in installments is treated as a normal loan, so information about it is transferred to the Credit Information Bureau. Therefore, if someone has not had a story yet – he will be able to create it. People who already have one will be able to improve it – of course, provided that the debt is repaid in a timely manner. This is extremely important if we want to apply for a larger loan, such as a mortgage loan.
We can do shopping in installments in virtually any furniture store or RTV-AGD store. So if we do not have enough money to buy the product we need for cash, it’s worth using this option. Of course, provided that we are sure that we will have the resources to pay our obligations on time.