Dispo covered, what to do? Is switching to installment loan worthwhile?

Almost everyone has ever overdrawn his disposition loan , in short Dispo.

A dispo can be obtained in most cases directly at a current account opening. The prerequisite for this does not even have to be a regular income. When opening an account, most current accounts with a disposition loan of up to 500, – Euro preset. If you want a higher collection, the bank usually has to prove only a regular income.

Tip: The Dispo is by far the most expensive type of loan that you can use!

It is no problem to avail the discretionary loan, it is problematic only if the own Dispo is permanently overdrawn and no longer serves only for the short-term bridging of financial problems. In times of online shopping and must-have-out deals you can quickly tempt the customer to buy. People who permanently (more than 3 months) cover their Dispo must be careful not to run in the Dispo Trap. Even if the discretionary loan can be used without any effort, there are a few points that the consumer must pay attention to:

  • Debt loan is very high interest
  • loan approval is often the first step in the debt trap
  • Disbursement declines the disposable income and leads to overspending.

What should I do if I’m permanently in minus?

Anyone who uses the loan line permanently will see a negative amount on each bank statement. In addition, the bank either per month or per quarter, the interest on the loan also interest. As a customer you not only have to repay the borrowed amount of money, but also high amounts for the accrued interest. Despite the low interest rates, every bank still pays the interest on such disbursements very expensive. So there are hardly any offers that are below 6% disposition interest.

What to do against overdrawn account?

If the checking account is permanently overdrawn, you should think about rescheduling . Since the collection is the most expensive type of loan , it may be worth switching to a classic installment loan to make up for the negative account. A installment loan over 1000, – Euro, for example, there are already from 2.75% effective interest at 12-month term (Santanderbank as of 13.09.2014). A rescheduling of loan on debit loan but only worthwhile for people who know that they can not compensate for their loan in the next few months. This often happens when you permanently spend more than you take. In such cases, an installment loan will help to balance the account. With the payment of the installment loan, the expensive disbursement costs are immediately eliminated, since there are no minimum terms for the discretionary loan. These are replaced by the significantly lower installment loan interest. Another advantage of rescheduling an overdrawn account is the fact that the loan amount that is repaid monthly is freely selectable. If the borrower can repay the loan only in very small installments, the term is extended accordingly. 

Change from loan to installment loan

Switching from disposition loan to installment loan is very easy. In some cases, even the house bank and offers this change on its own. This happens rarely and only with customers who permanently exhaust their Dispo. At least one should take a closer look at this offer, because the change from disposition to installment loan within one’s own bank is often cheaper, but the savings potential is not fully exploited here. The own house bank offers the installment loan to often worse conditions, than this on the market is available. Anyone interested in a installment loan, for example, to get their own current account out of the red, should use the free interest calculator on the Internet. These are free of charge for the consumer and quickly show at which conditions a rescheduling would be possible today. If the installment loan of the bank is similarly good, there is nothing wrong with accepting this offer. Who asks the question: ” Do I get a loan ?” Should first make a free loan request .