Once this vacation period is over, many Mexicans will require a loan and it is important to evaluate the options in the market
This holiday period will end and the return to reality will be inevitable, are moments in which many Mexicans go to sources of financing to complete their income or to obtain resources due to the lack of liquidity that deprives several households of the expenses of this period.
However, it is necessary to remain attentive to the financing costs that exist in the Mexican market; It is worth noting that today there is a marked variety of loans, many of them very accessible, but also with very high rates. In this market is also present the maxim that the higher risk is the interest rate. Then we mentioned the three most expensive loans in the Mexican credit market.
1) Loans over the internet, rates up to 1,000%
Online loans have been consolidated in the Mexican market as a strong financing option and have taken away participation from traditional sources, especially in the banking system .
The flexibility of your procedures is perhaps your greatest advantage, you can obtain credits in just a few minutes from the comfort of the contractor’s house, just meet the requirements. That money is deposited almost immediately in the personal account, another huge advantage.
But everything has a cost, and many times so much flexibility and comfort is expensive. According to the figures of some of the companies offering personal loans in cash in the network of networks, we have in all cases there are financing rates that exceed 100% easily , while in several cases more this cost is increases to four digits, there are loans of more than 1,000% at annual rate.
This type of credit is very expensive and very short term, since practically all those who offer it do so at an average term of 30 days, thereby “tightening” more to the clients since they must have liquidity in the short term. term to pay capital and interest. An annual rate of up to 1,000% is very expensive but it is not in illegality, since finally as private companies are in their right to offer the asset they have at the cost they consider, finally the customer pays it.
2) Pawn or short term and with a physical asset as collateral
This type of financing has the characteristic that it also requires leaving a physical asset as collateral , which increases the debtor’s risk because if he does not pay he can lose an asset that surely is worth much more than what they lent him.
The effort has also diversified, there are many companies in the Mexican market, so there is also a wide variety of costs. Generally the financing rates range from 70 to just over 100% at an annual rate, it is certainly an expensive loan with respect to other more formal markets.
3) Private savings accounts
If you have access to a private savings account without being a savings account, the cost you will have to pay for a loan with this institution ranges from 50% to more than 100% at an annual rate ; without considering the guarantees that must be left for them to lend, or the risk that the person who recommends it should assume if that is the case.
Although it is not usual for savings banks to lend to those who are not their savers , some do so to take advantage of the strong demand for loans that exist in our country, especially in a market that is not served by the formal banking system. because they do not meet the requirements that are required.
Undoubtedly, the need for resources is often imperative, but the costs of loans must be carefully evaluated to avoid further deterioration of personal and family finances; also avoid systems such as the so-called “drop by drop”, which is often linked to organized crime. Do not take loans from people you do not know or know little about, try to limit yourself better in your expenses so that you do not subsequently incur in stronger ones that damage your pocket and put your security at risk.
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