Which Loan Should You Choose? Cash? Account limit? | All Possibilities

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Which loan should you choose? The most frequently asked question when looking for loans and banks. If we decide to finance purchases from an external source, and not from our own savings, it is very important to choose a specific financial product. From him also depends the cost of borrowed money.

Banks offer many loan products. The most popular are loans and cash loans, installment loans, housing and car loans. The names themselves indicate what we can use: home, car, household appliances, foreign holidays or general renovation.

Loans and loans differ from each other for their purpose, type of security, repayment period, interest rate, etc. Lending alone is not something to blame. Hardly anyone can afford to buy a flat with savings or even a used car.

Only thoughtless use of loans can lead to serious financial problems. Borrowing by people who definitely should not do it only leads to further problems and ends with a spiral of debt. Many of us have more than just one loan, and there will be even several hundred thousand people (!) Who also have loans and cash loans, home loans, account limits and credit cards.

What credit to choose, which is the most popular loan in the bank

What loan is the most popular? Of course, there is only one and many people will point to a cash loan without any thought. This is the most popular credit product at the same time. dearest. That’s why we often ask for a cheap cash loan. Of course, such a loan can be found, provided, however, that we compare the offers (use, for example, the cash loan comparison engine to search for and compare loans).

The credit limit on your account

The credit limit on your account

We can distinguish several cash loans, and the most popular type of such a cash loan is the credit limit in the account, also known as a debit on the account or a revolving loan. Such a loan allows you to withdraw money from your account and make transfers. The credit limit granted by the bank depends on the amount of receipts made on the personal account. It is usually awarded between two and six times our monthly income.


  • it is easy to get such a loan,
  • no additional certificates or sureties are required,
  • interest is calculated on the amount of credit actually used,
  • every deposit on the account reduces the debt,
  • the commission on the granted limit may amount to 0 percent. in the case when we apply for such a limit via the Internet,
  • some banks offer promotional terms for those clients who transfer their credit limit from another bank.


  • sometimes it is required to have a ROR account with the bank for at least 3 months, similarly it may be with receipts to the account,
  • high interest rate, close to the maximum admissible. Currently, it is 9-10 percent,
  • the commission for granting the limit may amount to 0% as well as 10%,
  • the annual renewal fee, regardless of whether we use the limit or not. It can be determined by the amount or percentage (about 1-3% of the limit),
  • banks often persuade to take out insurance, which of course increases the cost of such a loan,
  • exceeding the limit may result in charging penal interest, additional payments or even in the worst case scenario, the bank may terminate the contract.

A cash loan

It may happen that the bank will refuse to activate the account limit, but it will offer a loan or a cash loan. We can also have a limit in your account and apply for a cash loan. There is a difference between a cash loan and a cash loan. The main difference is that the cash loan is a loan for a specific purpose and can only be granted by banks and credit unions. Because we usually take cash loans, that’s why we find the advantages and disadvantages of this form of financing below.


  • can be intended for any purpose,
  • high maximum amount of cash loan that can be obtained from the bank. On average, it is € 120,000, but we can find offers of loans and cash loans with a maximum amount of up to € 150,000 and € 200,000,
  • in the case of a small loan, no additional certificates and security are required, and the decision is made up to 15 minutes.


  • required certificate of earnings, loan collateral or guarantor in the case of cash loans for large amounts,
  • commission for granting a loan (there is usually a dependency that if the interest rate is low, the commission is high, and vice versa),
  • additional fees, e.g. preparation or administrative fee,
  • very often the bank requires compulsory loan insurance.


Installment loan

Popular when buying home appliances or audio / video products due to a simplified procedure. It is enough to just sign a contract and receive the goods in your hand. Repayment of installment credit is most often spread over 24 months, but there are offers with a longer repayment period. Remember to read the contract carefully, check the amount of all loan installments, because you may find that you pay more for the product than it actually is in the store.


  • simplified procedure, sometimes only boils down to presenting your ID card and declaring your earnings,
  • after signing the contract, we can take the goods home,
  • the interest rate on such a loan may amount to 0 percent. (also read the following defects).


  • sometimes it is necessary to present documents confirming the receipt of income,
  • the bank may charge a high commission or oblige to take out insurance.
Credit cards

Loan for free? There are no such loans. But a credit card can be a good option for consumers who want to buy using a cheaper loan.


  • the possibility of using a free loan during the interest free period. It is usually 50-60 days.
  • many banks offer to make a card for free,
  • additional bonuses for using the card.


  • monthly or annual fees are set depending on the type of credit card – most often they refer to prestigious cards or linked to loyalty programs,
  • the annual fee can be set from the amount of trading on the card or the number of transactions made,
  • no debt settlement in the non-interest period, accrued interest on the loan,
  • withdrawing money from an ATM is treated as a cash operation and commission and interest are charged (from the date of payment of the money – in this case the interest-free period is not applicable).


Mortgage loan

A mortgage loan differs from a mortgage primarily because it can be taken for any purpose. The loan is secured, as in the case of a mortgage, property. However, it is a property that belongs to the borrower or a third party (guarantor).


  • at high amounts, usually exceeding 20-30 thousand, such a loan is cheaper than a cash loan. Even when we consider non-interest costs: a fee for property valuation, mortgage entry, insurance, etc.,
  • the high possible loan amount (determined as a percentage of the value of the property) and the long loan period, even 30 years.


  • a long time associated with the completion of all formalities, and thus a longer period of time needed to withdraw money from the loan,
  • most banks set a minimum loan amount.

Do you know what loan you need?

Remember, however, that the bank dictates the terms of the loan or loan, but we are not sentenced in advance to worse conditions. We can negotiate the main points of the contract and it is even advisable to get the most favorable terms. In addition, if our creditworthiness and creditworthiness is high, the bank will certainly offer us better credit terms than the average customer.

We should always compare the loans and credits by checking the offer in the bank that runs our account and then compare the proposal with the loans in other banks.

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