When looking for the most advantageous personal loans it is necessary to carefully consider who to contact. Is it preferable to opt for a bank or a financial company?
From a bureaucratic point of view there are no differences, however the two bodies have different policies with respect to certain aspects. Let’s see them together.
Bank and Financial: what they are
The term bank indicates a company authorized to carry out banking activities, defined by article 10 of the Consolidated Banking Act as “the collection of savings from the public and the exercise of credit”.
So the bank acts as an intermediary between those who have the availability of money in the form of savings and those who request credit.
The financial one, defined by article 106 of the Consolidated Banking Act, deals with the granting of loans to customers, and must be registered in the list of financial intermediaries kept by the Bank of Italy.
Bank or Financial Loans: the differences
The bank is characterized by a considerable freedom of maneuver, both for the debt and for the credit, while the financial company cannot perform savings collection and management operations.
Precisely for this reason personal loans granted by financial companies have higher average interest rates. However, unlike banks, they give up accessory costs more often.
The financial companies also do not allow to customize interest rates, which is possible with banks which, in the face of large sums and good contractual strength, give the possibility of obtaining ‘ad personam’ conditions at subsidized rates.
In the loan disbursement times, the financial companies are faster than the banks, while for the duration of the amortization plans, if the first ones reach a maximum of 84 months, the banks at 120 installments.
Loans for bad payers: better banks or financial companies?
Another noticeable difference can be seen in the credit recovery procedures for bad payer loans.
The banks, only after having sent several direct communications to the customer and at the end of 60 days, proceed with the report and the recovery procedures.
The financial companies instead have a shorter time, from 30 to 45 days, before making a report to the Crif.
Bank or Financial Loans: how to choose?
Loans in the Bank or in a Financial? The choice should be guided by the possibility of obtaining the least expensive and most manageable financing. So you need to evaluate:
- interest rates;
- the duration of the repayment plan;
- additional costs.
As a result, applying for bank or financial loans depends on a series of conditions that offer the best product compared to what you need.
For example, if you need very short times, the financial ones are the preferable choice, if you want to request an important sum to be repaid in a long time, it is better to contact the banks.