There are all kinds of reasons for requesting a loan: renovating a home, buying a car, paying for a vacation, etc. In all of these cases, the need for the specific amount of money can be satisfied by applying for a loan- read more here. BBVA may represent a good option for financing any of these needs. Here you will find all the information you may need in relation to these loans, and you can analyze your own numbers with no commitment by using our simulator.
The initial step in establishing an agreement between the lender and the borrower is the loan application. First, the lender (the institution providing the loan) analyzes and studies the ability of the borrower or customer (the one requesting the money) to pay the loan back. The borrower or customer will have to comply with the loan obligations (to pay back the loan along with the interest and bank fees) by using all of the assets he or she possesses, in the present as well as in the future. This is why the bank will typically analyze the risks involved in the operation before agreeing to grant the loan, by requesting documents including those demonstrating a source of income, such as a salary.
The risk of the operation can be determined using aspects such as assets the customer has previously acquired, the capital available, banking history, etc., but above all the applicant’s sources of income.
Factors to take into account
Before the loan documents are signed, the terms for repayment of the principal loaned and the interest that will accrue must be agreed upon with the bank. In this calculation, there are three essential factors that play a central role: the principal loaned, the interest rate (NIR and APR), and the repayment term.
Any bank will perform a detailed study of the customer’s ability to pay back the loan, and depending on the conditions in each case, it will establish a price for the money being loaned. This is the interest rate, which is calculated by applying a percentage to the principal requested by the customer, then agreeing upon a repayment period that may be more or less demanding based on the risk of the operation.
Before signing for the loan, you must be aware of the Annual Percentage Rate (APR) that will apply to it. The APR is an indicator that includes the “all-in” cost of the loan since it includes the interest rate as well as all other applicable fees and costs. This means that it can be used to compare offers for a similar loan product from other institutions.
Advantages of a loan using a salary
Having a salary is not an essential condition for getting the loan you apply for approved. In fact, at BBVA you can get a certain amount of money as a loan quickly and without a salary, although the terms and conditions for a loan obtained using a directly deposited salary tend to be better.
The easiest way to find out the details regarding a loan is to use the loan simulator tool made available by BBVA, which provides step-by-step guidance for customers through the estimation process for their loans. It helps them select the amount they need and the repayment period, and they can also calculate the monthly payments and interest on the loan, depending on whether or not they have a salary directly deposited at BBVA.
When facing any significant economic challenge that requires an application for a loan, having a salary directly deposited during the entire life of the loan will provide a subsidy for the interest being charged, which will make this rate lower.