As banks inform us, by far the most popular when it comes to credit products, they enjoy a cash loan. These are loans that can be obtained very quickly (some banks give the opportunity to borrow money in this way during one visit to the branch), procedures are not too complicated (sometimes we can get a cash loan for the statement itself), and more and more often banks give us being able to apply for very high amounts.

The basis for obtaining a cash loan is to have the so-called ” creditworthiness “. Put simply, the bank must be sure that our income is high enough to make the money borrowed on time. Therefore, after submitting the application, we analyze our income, monthly costs and if the bank determines that we have enough money, the loan will be granted to us. Our credit history is also very important here, gathered in the Credit Information Bureau. If it is good, we will get credit easier and faster.

Depending on our income and credit history, the bank determines the risk it must take. And if it finds that it is low, firstly we can get a cheaper loan, and secondly, banks often do not require us to provide any collateral. However, if the bank decides that the credit risk is higher, our credit may be slightly more expensive, and the institution will require some collateral from us. This security is to make the money paid in the form of a loan, surely the bank will come back.

Banks use different forms of cash loan security. The most popular are:

Banks use different forms of cash loan security. The most popular are:

  1. Bill of exchange – we distinguish a few of them, and the most popular one is a blank promissory note, on which there is no specific amount or date of completion, the issuer’s bill, where the sum and date of implementation is, or a bill of lading, where the guarantor’s signatures are also included

  2. Surety – a guarantor, which is usually a natural person, undertakes to repay the obligation when the borrower does not do so. To become a guarantor, you should “go through” a similar path as the applicant, ie the bank will check its creditworthiness and history at BIK.

  3. Bank guarantee – is a collateral in which the guarantor undertakes to repay the debt if the borrower fails to meet his obligations.

  4. Declaration of submission to enforcement.

  5. Pledge on things – means giving the bank the right to sell movable property when the loan will not be repaid on time.

  6. Pledge on rights – transferring rights to a bank, for example in company shares, copyright or patent rights

  7. Transfer of receivables – granting the consent to the lender, to take over future income from the sale of goods or services to the repayment of the loan

  8. Blockade of bank accounts.

  9. Credit insurance

As we can see, banks have many types of collateral for cash loans to choose from. It depends primarily on the amount of credit, our income, our history in the Credit Information Bureau, and also on whether we are a regular customer of a given bank. Therefore, if we want to apply for a cash loan and if we want its security to be minimal, first let’s take care of a good relationship with the bank, build our positive credit history, and try to get the best creditworthiness. Then the bank will lend us money quickly, cheaply and, above all, without security.