The Difference Between Credit Holidays and Grace Period in Installment
Regardless of how much responsibility we will approach to assess your financial situation. Multiple analysis of whether we can afford a loan. Nothing can prevent us from certain random events.
We are not able to predict how our situation will look like in a few years. Even the most responsible person will not predict whether, for example, in 5 years he will unexpectedly lose his job and his financial situation will not deteriorate.
Especially with long-term loans. We are not able to predict what fate will bring us and whether we will not have to deal with temporary financial problems.
For this reason, before signing a loan agreement, it is worth finding out whether our bank offers such products as credit holidays and grace period in installments.
What Is the Difference between Loan Holidays and the Grace Period In Installments
Both credit holidays and grace period in repayment of installments postpone the payment of installments. They are to help us stabilize our financial situation and at the same time not fall into greater indebtedness.
The Bank looks more favorably at clients who inform their clients about their problems in advance, rather than those who do not pay their loan installments because they can not afford it and do nothing about it.
What is the difference between loan holidays and the grace period in repayment of the installment is the fact that by choosing a credit holiday the bank may postpone the repayment date of the loan installment in its entirety.
In the case of a grace period in the installment repayment, the deferment applies only to the capital part of the loan installment and is therefore not always profitable.
Who and How Can Apply For Credit Holidays and Grace Period In Installments
Both credit holidays and grace period in repayment of the installments are granted at the request of the bank’s client.
However, it should be remembered that not only not every bank has these products in its offer, but also grants them a separate decision independent of the credit decision and may refuse us to grant credit or grace period in repayment of installments.
The Bank has the best chance for a positive response from people who have been repaying their repayments regularly and on time, have a good credit history and exemplarily comply with the loan agreement with the bank.
In addition, credit holidays or grace period in repayment of installments are granted after a certain period of repayment of installments, i.e. after 12 months of the loan period. Both credit holidays and grace period in installments may be granted to us for a period of 1 to 12 months.