Why is it beneficial to have loans in case of default?

Credit and crisis are interconnected: the development of crisis phenomena forces banks to tighten the conditions of credit programs and raise interest rates. However, the crisis plays not only a negative role for the borrower. With the right approach, you can get a lot of benefits from loans. Which ones – described in this article.

Is it profitable to take out a loan during a crisis?

The peculiarities of the crisis are such that the value of money decreases, and goods increase in price. At the beginning of the crisis, when the national currency has not yet lost its “weight,” you can buy more goods for a certain amount than later, when the crisis phenomena are pronounced.

Therefore, it makes sense to “invest” in urgently needed expensive items: household appliances, furniture, building materials, cars, real estate. Over time, credit money will cost less, and it will become easier to pay it back. Especially those whose salaries are in foreign currency.

A loan in a crisis is profitable: reasons

During a crisis, buying expensive things on credit is more profitable than saving for them. Even with rising loan interest rates, you will pay less. After all, due to inflation, the cost of acquisition will increase faster than the amount of savings.

The profitability of a loan during a crisis is influenced by two factors:

1. Worsening crisis phenomena - devaluation of the national currency.
2. Long loan repayment period.

Ideal option: a loan with a low interest rate for 30 years. You can immediately rent out the apartment and pay the bank with rental payments. In addition, the cost of the loan installment is gradually decreasing, because part of the debt is “eaten up” by inflation. In addition, due to the decline in purchasing power, the cost of square meters, inflated in “fat” years, is reduced.

As for the foreign currency form of the loan, in times of crisis the rates on them decrease. Therefore, for those who receive income in dollars or euros, such a loan is the most profitable.

1. The development of the crisis entails an increase in the cost of loans. Banks are forced to do this in order to secure loans. Therefore, it is better to take out a loan at the beginning of a crisis, before rates rise.
2. A long-term loan during a crisis is more profitable than a short-term one.
3. In a crisis, it is better not to rush to take out a loan ahead of schedule. Loans become cheaper over time, and it will be easier to pay off.
4. The most “soft” lending conditions are offered by banks that have funds from the state budget.
5. High-tech goods quickly become obsolete and depreciate, so buying them on credit is not profitable in principle. While you are paying off your current loan, improved models will hit the market.
6. For inexpensive purchases, it is better to get a revolving credit period. It is easier to get than a loan.
7. When choosing a loan form, remember that the monthly payment should not exceed half of your income. You can't afford to spend more than you receive. The form of repayment is also important: differentiated or annuity. With a differentiated loan repayment method, the loan body gradually decreases, therefore, the interest decreases monthly.