A few years ago, some legal improvements were introduced, thanks to which it was possible to replace some of the certificates with declarations. The idea is correct, because it would save time in many situations. The most changed on this occasion in banking, because both banks and loan institutions, which later developed strongly, began to provide loans on the basis of statements, and not a certificate of income. But in practice, is it as beneficial to customers as the banks present it? Perhaps more advantageous are non-bank loans for the statement?
Loan for the statement and time
In the era of electronic applications, banks do not really need certificates, and the verification of all documents is almost as quick. The point where you lose the most time is getting a certificate. Not every employer issues it immediately, and then you still have to either deliver it to a bank branch, or at least scan it. This is where you lose the most time and if you look at the whole application for a loan, the introduction of statements has certainly improved the situation of borrowers.
Today, in practice, only data on the form of employment, income and expenditure are introduced in a special online application format, and the rest are dealt with inexact sophisticated algorithms that quickly provide information for which you had to stack papers and engage several people. Loans for the statement are therefore obviously faster than those credit offers that require the submission of certificates.
The price of the loan for the statement
On each loan, the bank and the financial institution must somehow earn money, and in this context, the assessment of the significance of the statements is not an easy task. On the one hand, it is an open secret that a diligently completed statement – probably no one has ever submitted a reliable statement of income, and on the other hand, lenders do not care. Responsibility for the content of the statement falls only on the client, and the banks and loan companies have clean hands.
However, after all, the probability of providing a loan or a loan for a statement of income to a person who does not have creditworthiness is in this case quite high. Theoretically, therefore, the bank should take this into account and therefore sometimes raises at least a price to provide a loan for a statement (interest rate and commission) to compensate for this risk.
This is still the case in a few not very progressive banks, while most savings result from something else: since credit applications for submissions are made via a website, there is no need for an army of advisers, so a cash loan for a statement can be even cheaper than the traditional one provided in the facility the bank. The latter (Credit Advisors) met a significant reduction in the number of posts, and this gave the banks additional funds, which in case they will be used to cover losses due to fraudulent loans.
Terms of loan repayment for the statement
The repayment terms for loans are determined by contracts and in fact the form of income documenting is of no importance to them. Of course, from the time when the statements were just entering the practical circulation, the repayment terms in each bank have changed, but this is the result of economic changes, fiscal policy of the state and modernization of the detailed policy of banks.
The effect – today’s repayment terms for loans for statements and certificates are basically the same, and possible differences do not result from the form of documenting income.
Advantages of loans for a statement
The main advantage of the loans for the statement is convenience. Thanks to this, the employer does not need to know that the employee is taking a loan, and the entire credit procedure is limited to the necessary minimum. Of course, one can get the impression that the loans for the statement and the certificate differ in price, but even if there are some discrepancies, they are not statistically significant, and most often result from the bank’s policy at a different point than the borrower’s income documentation.