Long and short loan period – comparison


One of the most important parameters that we take into account when deciding on a loan is the loan period . This factor is important for several reasons. First of all, because depending on the situation and needs, the best loan for us will differ in the term of the loan. Why?


Loan period – short or long?

Loan period - short or long?

The selected loan period depends on other aspects of our commitment. The final loan interest rate depends on this issue. Another important aspect is the amount of a single installment. In the case of a long loan period, the amount of a single installment is smaller, which is a more advantageous option if we are unable to afford a higher monthly expense. However, this also has other consequences. The positive ones include the fact that extending the loan period often increases the creditworthiness. But at the same time it has a negative aspect – as the commitment time increases, its total cost may increase. This is because not only the interest rate on the loan itself increases, but depending on the type of loan, additional costs may arise, such as life insurance or unemployment insurance. Therefore, when deciding on a loan and considering the length of debt repayment time, it is worth considering these aspects.


The best loan and the loan period – what to look for?

The best loan and the loan period - what to look for?

The possible length of repayment time also depends on the borrower’s age – it is assumed that the maximum age of the borrower at the time of repayment is up to 80 years. If this parameter is met, then when choosing a loan with a long loan period, it is worth choosing a bank that will not charge a fee for faster repayment. It is also worth adjusting the amount of installments to the possibilities of the household budget – the value of the monthly installment should not exceed 40-50% of net income. This fact therefore also makes the choice of the length of the commitment period dependent.



The best loan is one that we can pay back without significantly violating your home budget. Therefore, it is worth considering the various parameters described above. It is also important to consider changes that may occur during our loan repayment – unforeseen circumstances and random accidents. Choosing the length of the loan period gives us the opportunity to choose the most favorable option for us. The final cost of lending, or what period of lending will be safer for us, are important considerations. Before making the final decision, it is worth getting to know the banks’ offers and confronting them with your own budget.

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