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You've probably seen countless cases of people who got into huge debts by taking out loans or credit cards with higher limits, and today they consider these proposals to be true. credit traps.
At first, having a good limit seems interesting, especially for those with a lower salary, which sometimes does not provide satisfactory purchasing power.
But the rule is clear: using credit without clarification or incompatible with your income increases the risk of default.
With that in mind, today we'll discuss some of the main credit traps that still lead many to the SPC and Serasa credit bureaus. Check it out!
What are credit traps?
The term "credit traps" is the subject of much controversy in the market. Some consider it fair, while others believe there is no trap in this type of negotiation, as it is the applicant's responsibility to know what they are signing up for.
But, when it comes to the general concept, When we talk about credit traps, we refer to proposals that initially seem very advantageous and genuine solutions, but later harm the customer with abusive interest rates and poor conditions for paying off the debt.
A good example of this is the famous special credit, after all, having an extra amount in the account can be a relief in emergencies, but the interest on this modality is not at all light, and those who use it irresponsibly can fall into debts that are difficult to pay off.
Therefore, it is clear that this concept does not refer specifically to financial scams or illegal resources, but rather to credit proposals that may entail a greater risk of default and losses for the customer.
What are the risks of credit traps?
Remember how we said that some people don't accept the term "credit traps"? That's because they consider it a scam.
But, as we have already seen, credit traps are not scams, since they are financial services and products duly authorized and regulated by the Central Bank of Brazil.
The biggest problem with these services is the false impression of solution, security, and convenience they give the customer, which is later replaced by the shock of high interest rates and unfavorable payment conditions.
As we've already mentioned, special credit is an excellent example of this, so much so that many customers request that this additional limit be removed from their account due to the risk of falling into debt.
That said, the real risks of these traps is that the interest rates for these services are higher and more constant, so that in many cases they are charged per day.
Thus, a customer who subscribes to an overdraft facility sees their debt increase progressively, day by day, so that it becomes more difficult to pay as time goes by.
Furthermore, in many cases, banks do not offer favorable conditions for negotiating this type of debt, so the customer falls into debt and cannot find ways to clear their name easily.
Therefore, it is very important to be careful when subscribing to this type of service, and only use it when strictly necessary, with a plan in place to pay.
This may interest you: Investment-backed credit: how does it work and what are the advantages? (consultacred.com.br).
5 credit traps: be careful not to fall into them!
By now you understand what credit traps are and why they are called that.
Furthermore, we also saw that the special check is an excellent example, since it offers a solution and in the end charges the customer very high interest.
But did you know that this isn't the only service in this category? There are many others that work similarly, and they often refer clients to the SPC and Serasa with extremely high debts.
That said, if you want to prevent this type of situation, check out 5 of the main credit traps in the market below.
1. Minimum invoice payment
For those who ended up overpaying last month, the possibility of paying only the minimum amount on their bill seems very advantageous.
However, this is one of the biggest credit traps, as it makes it difficult to pay off debt and results in very high interest rates.
This is because, when you pay the minimum amount on your bill, there are two main possibilities:
1. The bank charges the remaining amount to the next month's bill, plus interest. This makes your next bill very high, and negotiation more difficult.
2. Your bill is automatically divided into as many installments as possible, resulting in high interest rates and a long-term commitment to your credit limit.
Therefore, paying the minimum amount on your bill isn't a good option. Instead, pay your bill in as few installments as possible.
This is because, even though you will pay interest anyway, it will be lower and the payment will be more organized.
++What is debt management and how to do it? Find out now! (consultacred.com.br).
2. Easy credit approval
For those seeking credit, every light seems golden, but it is important to remember that interest rates are the way the financial market compensates for risks.
Therefore, easy-to-approve credit proposals are often true credit traps, as they have higher interest rates and less favorable payment terms.
Note that loans for those with bad credit generally allow for payment in up to 12 installments, and the interest doubles or triples the debt.
This means that the installments become high, and the chances of you falling into debt that is difficult to pay off are much greater.
Therefore, before accepting any loan proposal, pay attention to the terms and conditions. If they're too restrictive, consider skipping them for the sake of your CPF.
3. Limits incompatible with income
Many people are happy to be offered a loan of R$ 20 thousand, when their own income is R$ 2 thousand.
This is because they think they're doing very well. After all, if the bank is offering such a high level of credit, it's because they have a good profile, right? Not really.
It is important to remember that interest is how banks make money and the greater the risk of the transaction, the more interest is applied to the contract.
Therefore, limits that are incompatible with income are true credit traps, as the interest rates are high and the installments are difficult to pay.
Therefore, if you accept this type of agreement, you will end up compromising a significant portion of your income, which could lead to difficulties.
Therefore, avoid taking out loans for amounts much higher than your income, as this will help you avoid defaulting on your payments.
4. Hidden interest on the invoice
Hidden interest charges are not permitted, but many customers are unaware that credit cards charge fees on their bills.
So, days before the bill is due, they log into the app and see one amount, but as soon as they receive the invoice via email, they notice it's much higher. Yes, that's the interest on the bill.
It's important to remember that credit cards have fees, so they shouldn't be treated like debit cards for everyday purchases. After all, you'll pay interest on each transaction.
Finally, we can consider this to be one of the credit traps, as many people make credit cards their primary payment method and don't realize they are compromising their income by paying fees.
5. Emergency limit
The emergency limit is a service very similar to the overdraft, but instead of being applied to the account, it is provided by the credit card.
At first, this proposal seems very advantageous, after all, who doesn't want the convenience of being able to swipe their card, even when the limit has already been reached?
But, it's no surprise that this service is full of interest, and has a problem, which is that it is charged together with the invoice.
So, if your bill is normally R$ 500 and you used the emergency limit of R$ 300, the amount to be paid will be R$ 800, which may exceed your spending plan.
Therefore, treat this service as you would an overdraft, and remember that it should not be a frequent supplement to your income.
Finally, now that you know the main services that lead customers to default, remember to use them with caution and only in cases of extreme necessity.
Read also: Financial stress: what it is and how to avoid it (consultacred.com.br).
