Personal credit vs. personal loan what is the difference?

“Many times we need to make a purchase or face an expense that we did not contemplate and we do not have enough money to achieve it. In these cases, to achieve that goal, we must resort to a loan or loan. Before making a decision, we must analyze the situation well since these two mechanisms are different from each other by their flexibility, financing, deadlines and interests”, says Florencia Valdes, Marketing Manager of Ixpandit Fintech Factory.

Personal Loans
It is defined as a financial transaction in which an entity or an individual delivers to the borrower an amount of money at the beginning of the deal, provided that that amount is returned in addition to the agreed interest, within a period also agreed. The repayment of such a loan is called “amortization.” Meanwhile, when referring to loans, it should be borne in mind that the operation has a period that is determined in advance and interest is charged on the total amount borrowed.

Personal Credits
It refers to an amount of money that an entity makes available to a client, with a set limit. The applicant does not receive that full amount at the beginning of the transaction but can use it according to the particular needs through an account or a credit card. In this case, the entity makes partial deliveries. On the other hand, the client can request all, a part or nothing; and only pays interest on the basis of the sum it has arranged. At this point it should be noted that a commission is usually charged on the undesoed balance.

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