Normally, a person wouldn’t borrow a loan unless he is compelled by a financial dilemma or a pressing emergency. As much as possible, a person would exhaust his options such as regular income or saving. Nowadays, things are different. People take out loans because they want to purchase new things or they were driven by the lender’s privileges.
As loan privileges become better, the demand for loans has also become more significant. Do you want to know why loan privileges can encourage borrowing? Here are the reasons:
Free Stuff is Always Nice
Everyone loves free stuff. This mindset has been around for hundreds of years already. Whenever you receive free stuff, you’d be more inclined to trust the giver (the lender). Companies have been using this method to sell their products more and attract large groups of consumers. Lenders, banks especially, include numerous perks such as accessories, gadgets, travel destinations, rebates, coupons, and loan discounts.
Better Financial Options
Borrowers often think that loans with privileges are better financial options. Well, they’re half-right. Banks and financial institutions can offer high-value loans in exchange of longer repayment periods or higher interest. Top it off with appealing perks and borrowers will indeed be attracted. To find the best loans with really useful perks, you need an in-depth research. Create your personal list of the top five lenders so you won’t have a hard time making a choice.
Psychologically, we are hardwired to grab something out in the open. Combined with the fact that we love free stuff, we are often baited by low-interest loans. To control your psychological impulse, you have to ask yourself if you currently need the loan or if there’s a better option. Make it a mental habit to know your priorities daily so that you won’t have troubles with your financials. If you’re having a hard time reining your impulse, you can also work with your spouse and family.
Loan perks and privileges are not necessarily bad, but you have to weigh your options. If the privileges are not worth your time or you don’t have an emergency at hand, maybe you don’t need the loan yet. You should consider loans as your last line of defense whenever a financial problem knocks on your door.