Universal credit is a type of loan that we can find in Chile. Universal loans are money loans that can be requested for the purpose of buying a home through a mortgage loan or for other expenses such as consumer loans or credit cards. The advantage of universal loans is that they can be compared and quoted more easily.
What is the Universal Credit?
As we have said, universal loans help us and facilitate comparison, when choosing the best credit. According to Law 20.448 and Regulation No. 1.512, companies that offer consumer loans, mortgages or credit cards, must also offer their corresponding universal credits.
Types of universal credits
The types of universal credits that we can find are:
- Universal Mortgage Credit: intended for natural persons and are granted exclusively for the purpose of acquiring, building or repairing homes. They are also intended to refinance existing mortgage loans that have been granted for the same purpose.
- Universal Consumer Credit: are credits intended for individuals and granted to obtain freely available money.
- Universal Credit Card: issued by banks that are used as a means of payment in businesses adhered to the system.
We must be clear that universal credits must be expressed in a clear and visible way, so that the consumer can understand all the information and compare with different credits of different companies and choose the most appropriate and with better conditions. Universal credits must contain the following information :
- Final cost of credit (results from multiplying fee value by installment number).
- Annual equivalent charge, to determine the total cost of credit in an annual period and which is expressed as a percentage.
- Commission and interest structure.
- Expenses associated with the credit, which in principle would be those corresponding to the tax and the procedures before a notary, although there could be others.
- Insurance with which the mortgage loans must be counted while the obligations derived from their payment remain.