A signed loan is a very convenient loan, because you don't need to find collateral or find a co-guarantor. It only needs you to use a signature to start. But the above benefits are for the lender. For the borrower, these benefits will make him bear huge risks. Because there is no collateral, he can only seek help from the court as long as he cannot find the lender. He has no right to move any property of the lender. After understanding the above two aspects, we can know that in order to make up for this risk, the treaty that wants to borrow this kind of loan is also extremely harsh.
It has a very high interest rate
From the previous analysis, we know that this kind of loan is very risky for the borrower, and high risk often corresponds to high yield. So in order to achieve this high yield effect, the borrower will increase the income of interest rate in the treaty. However, we need to know that this high interest rate is to deal with high risk. If you have a way to prove that you are a person with good credit and sufficient repayment ability, The better your impression on the borrower is, the more he believes in you, you can negotiate with him to get a loan with a lower interest rate, or you can negotiate with him about the repayment period. Too short or too long is not appropriate. You'd better predict the time period you need to turn over the loan next, and then borrow according to this period, do not delay too long, after all, the interest rate of this loan is also a large expenditure.
There will be some unreasonable treaties
For example, you may notice that in the contract, if you make overdue payments, there will be a penalty, and the amount is often very large. Perhaps you will also see that if you make early payments, you will also need to pay a fine, or the interest rate of the loan you need to repay will change with the passage of your repayment time. Of course, no matter what I mentioned above, please read the treaty word by word before formally signing it, Let's not miss any treaties. After all, these treaties are faced with great risks.
Have a great impact on your credit
The signed loan is like an investment. If you have a good management of this investment, its feedback is also huge. If you can repay it on time, it will be very helpful to your credit score, and even help you pave the way for future loans. But if you do not manage it well, it will also have a huge impact, just like your credit system will be seriously affected, It is relatively difficult for you to borrow money to do anything in the future.
May lead to your bankruptcy
As we mentioned earlier, if you breach the contract, you need to pay a large amount of liquidated damages, but at this time, your solvency has not changed much. If you can't find other funds to fill the gap at this time, the gap will only grow larger and larger with the passage of time, and eventually engulf you. The worst result of this may be to cause you to go bankrupt and finally carry out property liquidation, I believe this is what we all don't want to see.
