Sometimes banks approve a loan for a larger amount than is required by the borrower. Alexey Krichevsky, an expert at the Academy of Finance and Investment Management, explained why this is happening.
The goal of any bank is to make a profit. If an application for a loan is received from a citizen with a good credit history and a decent “white” income, the bank will want to keep such a client for itself, including by tying him in with a large amount of debt.
Also, the bank may have a minimum amount that is issued for certain products. For example, this is often the case for mortgages and car loans. In this case, you can simply pay off the surplus immediately, if such actions do not contradict the contract.
“The overpayment will turn out to be very modest, so it will not cause any big trouble, unless, of course, the borrower spends that part of the loan that was issued in excess of the requested one,” Krichevsky said in an interview with the agency.Prime“.
He added that any conditions that do not suit a potential borrower can be waived and applied to another organization. In addition, it is sometimes advantageous to take a large amount from the bank, but with a lower interest rate.