With short-term liquidity bottlenecks, the credit line is the first choice for many consumers. However, high disbursement costs are incurred.
But he is straightforward and immediately available, if despite low tide in the account unavoidable expenses are pending. It is also cheaper.
Different ways to avoid high interest rates
The Dispo is without question practical. And those who only have to provide for a little extra liquidity for a short period, can also use it without hesitation. However, if you get more urgent expenses, you should look for alternatives. Because if the current account remains in the red for a long time, the cost of interest, which is well in the double digits add up. Fortunately, there are several ways in which you can avoid high costs through overdraft interest.
Significantly lower interest costs for conventional loans
For larger expenditures, for example, when the car spontaneously demands a major repair, it may be worthwhile to take out a installment loan . Although this is not quite as spontaneously available as the credit line, but must be applied for. However, with up-to-date on-line loans pass between application and Gelderhalt only few days is the money within a few days in your account. If you have rashly drawn your bank card in the workshop, your account is quickly balanced again and so that the costs incurred for the discretionary interest remain within a manageable framework. The interest rate for an installment loan is often half of what is called for the credit line. With favorable offers, the debit interest can even be at a quarter of the discretionary interest. This savings should be worth the not very big expense of a loan application.
Sometimes it’s just small amounts, such as an unexpected tax bill by the tax office, which severely limits your liquidity and lowers your account. In such cases, a small loan is a good option. Just like a installment loan, it offers good planning, because the interest rates, which are also clearly below those for the credit line, remain constant for the entire term.
Dealer financing instead of credit line
For certain purchases, you may even come out without support from the bank. For example, if you need a quick replacement for the broken TV or broken washing machine, you should look around for a dealer who offers financing. You have this option in almost all major electronics markets and now many other dealers. However, you should thoroughly check the conditions in advance. You may be better off with an installment loan than with such dealer financing.
Outsmart the credit line with a credit card
Also, by simply using your credit card instead of the giro card for upcoming issues, when it is sparsely ordered to your liquidity, can avoid disbursement interest. In the case of standard credit cards, the transactions made are collected on a fixed day of the month from the current account of the cardholder. From the issue to this date, you will receive a kind of interest-free loan. However, planned action is required. You should be able to ensure that your account is sufficiently covered again at the time of the credit card statement. Otherwise you get the discretionary interest.