Many consumers want a long-term loan. Such a loan was originally intended for real estate financing, but that has changed in recent years. The reason for a longer term is the lower monthly charge, because the longer the term, the lower the monthly installments.
The higher the loan amount, the longer the term is generally. However, there are circumstances that make a longer term possible even with a lower loan. This is the case if, after deducting all running costs such as rent, electricity and the installments for the loan, there is not much financial scope left. A certain cash reserve should always be available for repairs or additional payments by the energy supplier. But for many, the income is not so high as to save money in addition to the loan installment. In such cases, a long-term loan can make sense.
If a loan with a long term is chosen, this makes the loan more expensive. Interest must be paid for an extended period. In addition, these can even be higher than for a loan with a short term. Therefore, it should be carefully considered for what purpose the loan is used and whether the loan is really necessary.
The banks have their own terms, which can be quite different. Not only are there differences in the amount of interest, but other things should also be considered when choosing the bank. What about a special repayment right, for example? Can a payment break be taken when paying the installments? What happens if the loan is redeemed early? Are prepayment penalties then due?
These are all points that are not easy to see at first glance. However, there are loan calculators on the Internet that provide a clear overview of the banks with the most favorable terms for long-term loans. Who compares here can possibly save a lot of money. In most cases, the long-term loan can even be applied for directly online at the respective bank.