The best loan options in the Dominican Republic

Maybe you are here because you are a resident of the Dominican Republic or because you read the project 2 section in this post and you want to hear about the difference in interest rates you could profit from using tokens, in any case, welcome.

Choosing the best loan depends on multiple variables, so we decided to separate this article into the best personal, home, and car loans.

Most of the information comes from the financial product aggregator Rexi. The rest of the information is validation of the data from rexi and although it is a great price aggregator, Rexi has inconsistencies that we will show you here so you can make the best decision.

Best options for mortgage loans

For purchase of land

There are not many options, The best option is the Cibao Association's land loan, which at the time of writing this article is at 12.95%. annual interest for a 15-year loan. Close behind are the Duarte Association's and Scotiabank's loans, both at 13.50%.

For 10 years or less, you also have the option of Banco Popular, where although the interest rate is 13.95%, you are not charged closing costs or legal fees according to Rexi.

All the above information comes from rexi, when conducting our research, we found that the annual interest rate for the Cibao Association loan is 15.95%., so again, although rexi is a great service we recommend, again, be alert (information in this link).

Sobre el crédito del banco popular we find in this link that in the rates section it is mentioned that there is a 3% rate for capital contributions greater than 20%, so again, alert.

For home purchase

The best option is the Maguana association mortgage loan for 10 years, with an interest rate of 10% and no penalties for capital contributions.

We were unable to corroborate this information; the tariff found by the Managuana association does not provide information on this.

Best options for personal loans for general use

According to Rexi, the best option for general-use personal loans is the BACC bank loan, which is approximately 8% (this value may vary depending on the loan's risk profile). The second option, the personal loan from the Oficorp credit corporation, has an estimated rate of 14%.

The detail with BACC bank loans is that they may have an early cancellation penalty (1st year) of 5% and 2% if the early cancellation is after the first year. All of the above can be seen in this link.

With the Oficorp credit, we find disbursement costs of 6% (composed of legal fees, appraisal, contract drafting, promissory note, and opposition procedures) and another commission of 0.25% (composed of taxes and charges for cash withdrawals from commercial banks). All of the above comes from this link.

Best personal loan options for debt consolidation

There are two options that will interest you, the debt consolidation loan from Abonap, which at the time of this research is at 23% and the debt consolidation loan from the Roman Association of Loans and Savings.

From the Abonap credit we find costs for cancellation or early payment of Loan, 2% on the outstanding balance and it increases per year, From a payment greater than 25% during the first year, 2% is charged on the outstanding balance and 1.5% the second year. All of the above comes from this link.

Best options for vehicle loans

new vehicles

The four best options are the new vehicle loan from Banco Atlántico with a 16% interest rate (with this loan, you'll also pay life insurance); the New Vehicle Loan from the Mocana Association with a 16% interest rate, where you'll pay life insurance; and the New Motor Vehicle Financing Credit with a 16% interest rate. Instead of life insurance, you'll have to pay legal fees. The last of these four is the New Vehicle Loan from the Oficorp Credit Corporation, with a 14% interest rate, where you'll also pay life insurance.

Non-commercial loans from Banco Atlántico have fees for early payment or cancellation. We are talking about 5% if made within the first year, 4% if made within the second year, 3% if made within the third year, 2% if made within the fourth year, 1% if made within the fifth year and if the loan is less than 3 years, only the last year would be exempt from penalty. All of the above can be verified in this link.

Oficorp loans had already been discussed previously in this post and we could not find information about the other vehicle loans.

I've already chosen the bank. How can I get a better interest rate?

Improve your credit score

Among the variables that a bank uses to determine the interest rate of your loan is the risk of default, and one of the greatest indicators of that risk is the credit score.

Several questions are used to determine the score, knowing them will allow you to increase the credit score, the most important ones include:

  • How long do you have credit experience?
  • In the last 6 months, you have opened 2 or more obligations (loans, cell phone plans, credit cards)
  • In your credit life you have successfully closed 9 products
  • You have more than 6 products
  • You have a housing lease
  • You served as a co-signer for someone
  • Have you had products that are more than 30 days overdue in the last 12 months?
  • Have you had products that are more than 60 days overdue in the last 48 months?
  • You currently have a balance in arrears
  • It's been more than 5 months since your last credit commitment
  • You pay your obligations on time
  • What percentage of your financial products do you use (credit cards)?

Increasing this score takes months and even if you behave well financially, the score will increase very slowly. Currently you must pay to see your score, but you can see the credit history that financial institutions see about you for free. You can follow these steps: indications.

Once you have the loan, you can ask the bank to lower the rates even further

Continually check the interest rate values of other banks, if your current rate is two percentage points higher, go to your bank to negotiate a reduction.

The bank isn't obligated to improve your loan terms, but this often happens. Consult with other banks to build a strong case.

If you are paying more interest than other entities currently offer and your bank does not agree to improve your conditions, consider refinancing, purchasing a portfolio, and consider consolidating your debt..

Maintain a good credit history, this will help you get a better offer at another bank or at your current bank.

The bank will never call you to offer to lower the interest on your loan, you must be the one to contact them.

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