At least since the European Central Bank lowered the key interest rate to a historically low level, the discussion about the still high interest on disbursements has come up in many media. In some cases, account holders still pay more than ten percent for overdrawing their checking account. Rarely in the context, however, talked about the overdraft interest, which are once again significantly higher than the discretionary interest. For those who temporarily overdraw a promised credit line in the form of the disposition credit must pay interest in the amount of 16 or more percent per year.
Overdraft interest on the test bench
Currently, these overdraft rates are under discussion , but in a very positive for consumers. There are more and more credit institutions that completely refrain from calculating overdraft interest. First and foremost, there are some savings banks and Volksbank or Raiffeisen banks that have already begun to remove the overdraft interest from their tariff or price list.
In such cases, the account holders only have to pay the agreed dispositions if they make dispositions beyond the promised credit limit. If this trend continues, account holders will at least not have to pay very high interest rates of 15 percent if they have exaggerated their checking account to some extent. Nevertheless, most experts continue to criticize the excessively high interest on disputes, so that in many cases it makes sense to look for an alternative to the utilized discretionary credit.
Overdraft of the credit line should be avoided in principle
Even if more and more banks now resort to no longer calculating the overdraft interest rates, customers should still be careful not to let the credit line being exceeded . Even if there are no additional interest rates, it does, in a sense, mean a kind of loss of confidence on the part of the bank if the client is unable to meet the agreed line of credit. Moreover, it is, of course, the case that the Bank is by no means obliged to allow such dispositions to go beyond the committed credit limit.
In the worst case, it may happen, for example, that a rental payment is not made, because the corresponding amount would ensure that an overdraft of the credit line takes place. Who leads his current account almost permanently in the target anyway, should basically consider whether, for example, the installment loan can be a much more useful alternative to the discretionary loan. It is advisable to reschedule this from the credit line to the installment loan, especially if the account is over a period of one year or more in the range of at least 2,000 euros. In these cases, it is definitely a good idea to balance out the current account and instead accept a installment loan that will gradually be paid off.