Using the credit redemption can save interest on interest rates or reduce monthly payments, this is when to apply for this financing.
Credit redemption when rates are low
A borrower who has taken out a home loan may, in the event of a fall in rates using a real estate loan, this transaction simply involves contacting a bank other than the one that has granted the financing to buy the loan back. ‘habitat. This transaction is only relevant if there is a significant difference in the rate between the initial loan rate and the repurchase rate.
It is estimated that a difference of one point makes it possible to cover the costs of setting up the financing but also to generate a gain on the reimbursement of interest. It should be known that it is the total cost of the credit that makes it possible to define whether the transaction is of interest or not. Many borrowers manage to negotiate a lower mortgage rate but do not think about negotiating the cost of insurance, which can sometimes increase between old credit and new financing. It is good to take everything into account when negotiating.
Make a redemption of credits when monthly payments accumulate
Repaying several credits at the same time can lead to a situation of imbalance, that is to say that borrowers are required not to exceed a debt of 33%, that is, not to devote more than a third of his income to credit charges. By approaching this limit, borrowers find themselves very often in delicate situations, especially when an unexpected expense appears. Using loan consolidation at this stage makes it possible to readjust the repayments with a smaller, less burdensome monthly payment.
Consolidation of loans becomes interesting when the end of the month are difficult, or even before, when the various deductions of credits cause a complication in the management of its finances. The interest is to extend the duration to reduce the new monthly payment will be fixed, note that we can choose the date of withdrawal of this new deadline taking into account its various levies other than credits.
Simulate the redemption of credit to better project
The credit buy-back is above all an operation that adapts to the needs of each borrower, that is to say that each person will see his own interest. If a person wishes to take advantage of the repurchase of loans for the rates of the moment, another will use it to buy the balance of his ex-spouse, just as a borrower will subscribe to this financing to avoid over-indebtedness. Everyone has a good reason to use this funding and a personal interest.
Simulation makes it possible to measure the first effects of a credit redemption according to one’s personal situation, which makes it easier to determine the interest of setting up this banking operation. It should be noted that this approach is free of charge.