Non-bank long-term loans: how do they differ from payday loans and bank loans?

Installment loans in non-bank institutions are certainly more and more attractive competition for hard-to-reach loans in banks. A dozen or so years ago, the current situation would seem something unthinkable. Banks seemed to be the only really significant player in the credit sector, while loan companies constituted at most a marginal margin towards banks. However, a lot has changed since then. On the one hand, the banking industry has undergone several serious crises, on the other hand, the loan sector has been in a dynamic development phase for a long time. This development allows current lending institutions, among others, to offer their clients long-term loans in installments on terms that are often even more financially attractive than in the case of bank loans.

However, this does not mean that non-bank installment loans are the exact equivalent of bank loans. What are the most important differences between the solutions in these two categories? Let’s take a closer look at this issue and try to answer the above question.


Long-term non-bank loans: what is worth knowing about them?

Long-term non-bank loans: what is worth knowing about them?

Practice shows that many customers still associate the offer of loan institutions primarily with such solutions as the proverbial payday loans, i.e. quick loans for relatively small sums of money and with a rather short repayment period. It is worth realizing that payday loans are by no means the only segment of the offer of modern loan institutions. The second segment is long-term loans . How are they different from payday loans? Of course, the two most important differences are the repayment period and the maximum loan amount. While in the case of popular payday loans, the standard repayment period is 30-60 days, for long-term loans it can be even 48-60 months. The maximum available loan amount will also be several times higher than for payday loans. More detailed information on the offer of non-bank installment loans available on the market can be found. What is the difference between installment loans in non-bank companies and bank loans? The basic difference is of course availability. As you know, getting a bank loan is not an easy task, if only because of the need to provide extensive documentation. Lending institutions are, in principle, much more flexible than banks.


Before you take a loan

money loan

It should be taken into account that any, even easily available, commitment will have to be repaid. Therefore, before taking a loan, we should calculate exactly whether we can afford to pay monthly installments. On the other hand, if we anticipated the possibility of difficulties in this respect, it would be worth choosing a loan offer with the option of credit holidays.

Of course, before taking out a loan, you should verify the status of the potential lender by checking whether the company is listed in the Register of Loan Institutions operating at the PFSA.