With a small income, it is more complicated to get a loan from banks. It is necessary to provide supporting documents and the strict conditions exclude low wages and unemployed people. In these conditions, how to undertake projects in life? There are solutions adapted to these situations, in particular small salary credit.
Difficulties accessing credit for small budgets
For the unemployed, people in precarious situations such as fixed-term contracts or those on file at the National bank, the procedures for obtaining “classic” credit are sometimes complex, even discouraging. Credit institutions often ask for supporting documents such as payslips and credit history. In addition, banks are examining the debt ratio. This should generally remain below 50% and sometimes even 40%.
With a small income, this rate rises quickly as illustrated by this example: with 1,150 dollars of income per month, a person paying a monthly rent of 500 dollars will have a debt evaluated at 43%. In this case, an application for a personal loan is unlikely to be successful, since the banks impose too strict conditions on the borrowers. On the other hand, there is a solution for credit for low wages, find out here.
Small credits for small incomes
Contrary to popular belief, there are many credit solutions for small budgets. Among these small credits are:
- The interest-free loan between individuals: as its name suggests, natural persons here replace the traditional lenders that are credit institutions.
- micro credit granted by (Association for the Right to Economic Initiative): this type of small credit is particularly suitable for people who are over-indebted or registered with the Capital Lender. This credit can reach $ 3,000 provided that this sum is allocated to a professional integration project (driving license or training for example).
- revolving credit: it is a form of consumer credit offering people with a low salary a reserve of money.
To obtain a personal loan and benefit from its advantageous interest rates, a person with small incomes will have to carry out a simulation in order to correctly calibrate the monthly payments and the duration of engagement to take care of his debt ratio.