Interest-free loans and delayed first payments

An offer that delays the first payment can create breathing room, but it does not necessarily reduce the cost of borrowing. An interest-free period has a different meaning: it concerns the interest charged during a stated time. A product can contain either feature, both features or neither, so the written terms matter more than the slogan.

Ask what happens during the waiting period

Check whether interest and fees accumulate before the first instalment. Find out whether they are added to the balance, collected later or waived under specified conditions. Also check whether the later instalments become larger or the final repayment date moves further away.

A useful question is: if I receive this amount today and follow the proposed schedule exactly, how much will I pay in total? Then ask how the figure changes if you repay sooner. Do not assume that settling within an introductory period automatically means there will be no charges.

Compare an affordable schedule

Use the same loan amount and overall term when comparing lenders. Review BVKKMN, the total amount payable and every payment date. An ordinary schedule may fit your income better than an attractive initial pause followed by payments you cannot comfortably manage.

Promotions may be limited to a particular customer group, amount or application period. Earlier articles mentioning one or two free months are historical descriptions, not confirmation of today’s availability. A lender still assesses documented income, existing debts, residency and its own requirements.

If the first payment has been postponed, put that date in your budget immediately. The absence of a payment this month does not make the money additional income. For related terminology, see our guide to BVKKMN and interest, and ask the provider to explain any difference between its advertisement and the individual agreement.