Credit System in the US
In the United States, young families live in comfortable country houses, and students drive around in expensive cars. A credit system provides them such an opportunity, which is rightfully considered one of the most effective in the world.
Lending in the USA
Credit is currently a common service for residents of the United States. For most citizens, tribal loans open all doors, and they don’t worry about the house, car, furniture, household, etc. This is a unique lifestyle that allows you to enjoy all the benefits when necessary. Young people who are just starting the career ladder cannot afford expensive purchases. If you save money, saving on everything, you can achieve prosperity only by the age of 35-40. During this period, families are created, children are born and grow up, which also have to be limited in desires. Lending makes it possible to avoid these problems.
In most US banks, the monthly interest on loans is about 2%. A real estate loan is issued for 30 years. This makes it possible for a person with an average salary of $2 thousand to buy a house for a family, worth about 130 thousand dollars, without experiencing problems with paying a loan.
Pitfalls of American Credit
It is not difficult to obtain loans in the USA. This makes them very popular. And, nevertheless, banks present some requirements for customers. For large loans, a down payment is required. Its size directly depends on credit history. For foreign students, a loan application is limited to 3 thousand dollars. Moreover, you can get such an amount only with the guarantee of a US citizen.
Credit history is essential for every American. The existing rating of this indicator is not only taken into account when deciding whether to grant a loan. Unpaid loans and delays in payments can cause a refusal to accept a job, rent a property, or even connect to the Internet. It is worth considering the high prices of medical services, which take a lot of money. Therefore, in addition to credit history, US citizens sometimes have to get acquainted with such a definition as a bankruptcy.
A citizen who does not pay loan debts is declared bankrupt, for which a special legal procedure is provided. At the same time, the state deducts all existing debts from the person. However, for a period specified by law, a bankrupt can not only take a loan but also make big purchases for cash. For those who could not repay the loan for a good reason, state support is provided.
The credit system in the United States makes it possible to use all the benefits without spending time on the accumulation of funds. But neglecting obligations on bank loans can cause a hopelessly damaged credit reputation.