Sometimes there is a moment when we need money. And whether it’s a holiday, communion or a gift for a loved one, we face a dilemma. What will be better for us – credit or payday loan? At first glance, it may seem that they mean the same thing, but if we look closer to the topic, it turns out that appearance seemed deceptive. So what are the differences between these financial decisions: credit and loan?

Although loan and credit are financial forms of support for the consumer who is not trying, but a lot of them are different. First, a credit can be both money and material goods, while a loan can only be taken as money. The second difference between credit and payday loan is the organization that awards them. In the case of a loan, there will only be banks and BANKS. While a loan can be provided by anyone who owns the borrowed money ( credit companies, financial institutions, individuals, as well as banks).


It is important that the loan must always be concluded in writing (the exception to the rule is banking. In this particular case, the loan agreement can be concluded on the Internet, but only under certain conditions and requirements stipulated by the law on banking law). In contrast to the loan, which does not require special formalities and can be concluded even orally (except when the loan amount exceeds $1000, the contract must be drawn up and signed by both parties, both the lender and the borrower).


When we take a loan, we can take it for any purpose without worrying that the person or institution from which we borrow, will be asked for what specific purpose we will issue the money transferred to us. Even with low incomes, there is always a chance that we will get a loan in the amount of what is currently needed. Otherwise, in the case of a loan. Here banks are guided by the so-called principle of expediency of the credit, i.e. to receive financial assistance from the Bank, we need to specify a specific purpose in a special application, credit, for which we want to allocate it. In addition, before we get a loan, the Bank must check our solvency. If it’s too low, we won’t get credit. However, even if all goes well (ie. we will have a credit account and we will not be in the register it may happen that the Bank will offer us a loan amount much lower than the one we concluded. This is due in large part to the height of our creditworthiness, which in turn depends on the income we have; the higher the better for us.


In addition, the lender, unlike the lender, has the right to check whether the money that has been provided to us is used in accordance with the terms set out in the loan agreement that we have concluded with the Bank. If not, the lender in this case, the Bank or the Bank, has the right to terminate the loan agreement. This is possible because, unlike a loan, after receiving which we own the borrowed amount, in the case of a loan, the borrower (that is, we) is only a temporary Manager of the amount that the Bank has transferred to us in the form of a loan. In case of any violations on our part, the Bank, as the owner of the amount borrowed by us, has the right to speak to us contract.

Credit and credit-is there something that unites them, despite the fact that the credit agreement is governed by the Civil code and the credit agreement by the provisions of the banking law act, then both fall under the consumer credit act. This is especially important, for example, when you want to pay off your deposits early. Regulate this, in particular, the Federal law on consumer credit. The cost of financial assistance is also an important issue. In the case of a loan, before crediting it should be noted that all our financial obligations to the Bank, will consist not only of the amount of the loan, but also the Commission and interest rate accrued from the amount of the accrued loan, not to mention insure a loan that further increases costs. In the case of a loan, the cost of providing it can be gratuitous, but usually an interest rate is charged, as well as a Commission.

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