What is the payable margin of a loan?

Truth be told: It has never been easier to borrow than it is today. Banks and lenders have understood that lending, if well structured, becomes an attractive product for an increasing share of people seeking additional money.

In so many ways and means of hiring available (online credit via application; with property or car as collateral and lower interest for example), one of them remains very attractive among so many types of credit available: payroll loan.

Payroll Loans: Low Interest Credit and Longer Term

Payroll Loans: Low Interest Credit and Longer Term

This type of loan is quite usual in the market, and for various reasons. The differential is the form of concession, which is necessarily tied to people who have employment, civil servants, active military or retired INSS. Therefore, it is a type of credit that is only granted to people who have “right income”, ie source of regular and monthly income.

One way banks have found to grant more assured credit that they will get back the borrowed money, because the payroll loan repayment is “separated” into payroll and routed directly by the borrower’s payroll to the lender, without person needs to pay the benefit directly; The portion is discounted from their due dates.

This form of credit, which is backed by the borrower’s own income, provides the bank with lower interest rates and longer repayment terms, given that credit returns are more guaranteed. After all, there is an expectation that default will not occur compared to credits granted in other ways.

However, there is an important component in this type of loan that marks the taking of this type of credit: the consignable margin.

Payable margin: the required limit

Payable margin: the required limit

But what is the consignable margin? It is a limit imposed by law on how much you can commit from your income to repay a loan. In the case of payroll loans, this limit is 30% of the person’s monthly income. That is, it is not possible to take out a payroll loan whose repayment amount is above 30% of your monthly income.

This “lock” prevents you from unbalancing your monthly income and even affects your other expenses in the month, such as food, transportation, housing, etc. With up to 30% being the consignable margin of their income, banks and lenders work credit simulations within this limit, considering among other aspects the profile of the loan contractor.

Not all banks offer a consignable margin of 30%, and there are institutions that have a lower limit to margin payroll loans. So be aware of the conditions of granting a payroll loan because banks calculated your exact margin (how much you can borrow) when simulating your loan.

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