Revolving credit is a small loan that is easier to obtain than other types of consumer credit, flexible to use, but also offered at a high credit rate. We will see how to get a good revolving credit rate, but above all how to get an immediate answer in principle.
The revolving credit rate, an adjustable APR
The revolving credit rate is a revisable APR (annual effective annual rate). It differs from the fixed APR rate, associated with all other consumer credit solutions. The revisable APR indicates that the borrowing conditions can change between two uses of money or during the contract.
Revolving credit makes it possible, as its name suggests, to use the available balance several times. It actually grants a reserve of money available at any time, by transfer or through a revolving credit card. This ease of access to a sum of money or purchase on credit is generally not given. This is why the revolving credit rate is often high.
A low-rate credit obtained when the loan is first opened may therefore be different from that offered in the context of using available funds. No need to panic: the credit contract always clearly indicates the conditions of each use on credit, as well as the new total amount due. It is therefore possible to have several payment schedules – or repayment plans – within the same revolving credit. However, there will always be only one global monthly payment levied.
Reminder: the main principles of revolving credit
Now that the adjustable APR rate has been explained, it is important to give a reminder regarding the main principles of revolving credit.
- Amount: generally between the 500 USD and 4000 USD credit
- Duration: 36 months maximum up to 3000 $, 60 months beyond
- Amount available which is replenished with each reimbursement
- Possibility to use the available money at any time
- Revolving credit rate: Revisable APR
- Early repayment possible without any penalty
Revolving credit: maximum rate allowed
Note that the maximum authorized consumer credit rate – including revolving credit – is fixed each quarter by the Banque de France. The so-called “wear and tear” rate prevents abuse.
|Maximum rate applicable in the 2nd quarter of 2019|
|Credits of less than 3000 USD||21.11%|
|Credits between $ 3,000 and $ 6,000||12.60%|
|Credits over $ 6,000||6.08%|
How to get the best revolving credit rate?
Finding the best revolving credit rate is an important issue. Our credit comparator retrieves and offers the best rates for small credit solutions, but it doesn’t stop there. We include in our comparison the chances of receiving a positive opinion. A request for revolving credit is often associated with a rather urgent need for money. However, there is nothing more frustrating to be faced with a loan refused on a small amount. Some online revolving credit professionals more or less accept small loan requests. Proposing a response at the best rate with agreement in principle is our priority.
Any request for credit 4000 USD or less made on our comparator directs towards the best revolving credit solutions.
Short term = reduced interest
A shorter credit term results in reduced interest, and generally a better APR rate. You should know that revolving credit sometimes works with repayment speeds. The Bankate revolving credit allows for example to stagger its repayments in an “express” (16 months), “fast” (24 months) or “comfort” (31 months) manner. The rate for the shortest speed of a 2000 USD loan is offered at 12.90%, while that for the slowest speed is 21.10%. Once compared with the APR rate and the duration, the interest varies in this case from simple to triple ($ 178.63 compared to $ 556.04). This logic is the same for all players offering small or mini credit solutions. When its repayment capacity allows, it is preferable to shorten the duration.
Find the right balance between duration and monthly payments
You don’t always have to stop at the revolving credit rate to find the solution that best suits your needs. The monthly payments enter the balance. A credit of 2000 USD to be reimbursed in 12 monthly installments means, for example, to take out around 200 USD each month. This amount is not always easy to repay. The search for small monthly payments can take precedence over the revolving credit rate.
Organizations or banks are in any case obliged to check the repayment capacity before giving their final agreement. Everything is a question of balance and ability to repay well. In case of doubt or regret, the borrower can retract for 14 days from the date of signing the contract.
Good to know: the possibility of repaying in advance without any penalty makes it possible to limit the interest on a revolving credit. The fact of settling his credit indeed erases the remaining interest due.