4 tips before borrowing money

As an employee, sometimes suddenly comes the unexpected need. If we have enough money is not an issue. But if this happens when we are still saving a bit and we are also still having limited income, would be a tricky thing isn't it? Well, finally the solution we choose is get a loan. When we are borrowing money, surely we have an obligation to be borne that is return the money back together with interest.

Here are some tips if you are borrowing money.

1. Borrow the money from the agency or person who is trusted
There are so many scams that occurred in recent years. So we must know how to react and be vigilant. It is important to borrow money from people or entities that have a legal basis and can be trusted. Do not borrow money from moneylenders.

2. Pay attention to the amount of interest.
In a variety of loan products, there are so many who promising the low interests. However, do not immediately believe it, the promise of low interest rates could also be a delusion. Find the interest on the loan is equivalent to the prevailing interest rate. Do not choose interest that is too high, but also do not be fooled by the number of facilities.

3. Do not use the loan money for day to day needs.
The money that we borrowed must be used to create greater income (rotated). Do not forget that the money we have borrowed is having interest to be paid at the agreed time. Therefore, try to use that loan money for urgent needs or as capital to build new business. Thus, we will not trapped in debt piling.

4. Be careful with collateral.
Most banks require collateral as a condition if we want to borrow money. Do not give your home as collateral to get a loan. This is done in order to avoid things that are not desirable if we could not pay that is our home is not to be confiscated. The house is an asset whose price is continuously going up. Instead, we make it as collateral; we had better sell it to pay the debt.

In certain emergency situations combined with the lack of money in the bank, could force someone to borrow some money from the lending companies. If someday you need to borrow money, be sure to borrow only when absolutely necessary.

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