July 16, 2019 The commission for granting the loan is the basic fee charged by the bank. It applies not only to cash loans – it also accompanies mortgage loans. What are the other types of commission and can I find a loan offer without a commission? Check if you don’t want to pay a bank commission that raises the total cost of the loan. We invite you to read!
What is the bank commission?
The bank commission is a fee charged for carrying out certain activities on behalf of a client. In the case of commission for granting a loan, it concerns the release of funds after the conclusion of the loan agreement. It is a one-off cost and is a percentage of the loan amount. The higher the loan, the higher the commission.
The commission is charged in the form of one payment or added to the loan. Lending commissions results in increasing the total cost of the bank loan and increasing the monthly installments. On the other hand, a one-time commission payment can be too much of a burden for your household budget. Therefore, when looking for the best offers in the cash loan ranking, let’s check the fees. Otherwise, the installment size may be a pleasant surprise for us!
What is the commission for granting the loan?
The commission along with the interest rate is one of the main parameters affecting the total cost of the loan. It can reach up to 25 percent of the amount of the cash loan! Unfortunately, many banks do not provide the exact amount of commission. They inform customers that the commission is set individually. Let’s check in which banks we can check in advance how much this fee will cost us!
Non-interest loan costs according to the Anti-usury Act
The new Anti-usury Act of 11 March 2016 is an amendment to the Act of 21 July 2006 on supervision of the financial market and the Act of 12 May 2011 on consumer credit. It introduced limits on the costs of non-interest consumer loans, including commission costs, loan insurance, preparation fees and home-related fees.
Pursuant to the Anti-usury Act, the sum of non-interest loan costs may not exceed:
- 25% total loan amount (permanent),
- 30 percent the total amount of consumer credit per annum (variable part).
All loan costs cannot exceed the equivalent of the amount paid to the borrower.
The Anti-usury Act applies to the entire financial market, including online loans. The government is working on another amendment to its provisions. The new draft anti-usury law provides for even more effective protection against dishonesty of some entities in the financial sector.
Remember that the commission is only one of the bank fees. If we want to find out how much a loan costs, we also need to trace the amount of the remaining fees, including the interest rate mentioned above.
Types of bank commissions
The commission for granting the loan is not the only type of bank commission. Other types of commission related to loans are:
- commission for considering the loan application, collected even before issuing the loan decision,
- commission for early repayment of the loan. Its amount depends on whether it is a partial or total repayment. In the case of mortgage loans, it can only be taken for the first three years of the duration of the contract,
- commission for increasing the loan amount,
- commission for currency conversion of the loan,
- commission for writ and debt collection activities,
- commission for granting / launching / extending / increasing the credit line for revolving loans.
The commission also applies to mortgage loans. As with a cash loan, we either pay it in full on the day the loan agreement is signed, or the bank adds it to the refund amount, and thus to our monthly installments.
The bank decides about the amount of commission. Can we influence how much this fee will be? Yes, we can choose from many loan proposals, looking for the cheapest mortgage. It is also worth following the current promotions so as not to miss any attractive offers.
Margin and commission – a mortgage with a low margin or no commission?
When browsing the mortgage offer, you can find both commission-free loan offers and proposals with a low loan margin. What is better for our portfolio?
If you plan to pay back the loan earlier, the commission-free loan with a higher margin is much better. The bank adds a margin to each loan installment. Giving the money back sooner will not be a problem for us.
In turn, when paying off in accordance with the agreed loan repayment schedule, it pays to choose a loan with a high commission and a low margin. A low margin means lower interest rates, and therefore also a lower loan installment.
Do banks offer a loan with no commission?
Borrowers will be pleased that banks also grant no commission cash loans today! However, additional conditions must be met, e.g. take a loan online, borrow a strictly specified amount, or purchase additional insurance. Often a loan offer of 0 percent applies only to new customers. If we meet the requirements set by the bank, nothing prevents us from taking advantage of a convenient promotion.