Debt consolidation: what is it?

Too easy credit, an incentive consumer society, an accident in life, all these factors may lead to excessive debt. You have too much debt, deadlines always more difficult to honor and a purchasing power reduced to a skin of sorrows? React quickly to prevent the situation from getting worse. Think about loan consolidation .

What does this consist of ?

This banking operation offers you to collect all or part of your outstanding loans in one credit to close by anticipation through a new loan called “restructuring”. The latter will be spread over a fixed period and reimbursed by a single deadline, reduced and adapted to your repayment capacity and a debt ratio of less than 33%. The lending bank will take over the debt and pay the loans to the various organizations.

Loan consolidation covers all consumer loans, loans, auto loans, personal loans as well as bank overdrafts.

The repurchase of credit can also integrate a mortgage. If the outstanding amount represents more than 60% of the total amount of the restructuring operation, the new credit will be considered as a mortgage. If this operation can be interesting, it deserves a thorough study because the longer the repayment period, the more the credit is expensive.

It should be remembered that the repurchase of credit is not exclusively reserved for people strangled in excessive indebtedness. If you have several loans that you can repay perfectly but you want to finance a new project or you make savings, it will be interesting to reduce your debt ratio by consolidating all your credits.

The benefit of a single reduced monthly payment

By choosing to buy back your credits, you will rebalance your budget by considerably reducing your monthly payments, in some cases up to 60%. Instead of repaying several small loans, often with very high rates, as is the case for revolving loans, you will have a new loan spread over a longer period but with a single term that will leave you more comfortable and therefore a higher purchasing power.

Enjoy a fixed and lighter interest rate, more advantageous

If you have several cash reserves whose variable rate often exceeds 16%, it becomes more interesting to group them into a single credit that will be assigned a fixed rate generally between 7 and 9%. You could also take out consumer credit at a time when rates were higher. If the redemption proposal made to you announces a lower rate, you will enjoy much lower monthly payments .

For the redemption of my credits how to do?

Too many loans? Do not wait any longer, think about buying credit! Lighten your debt and find a financial ease that will allow you to offer some pleasures that you had lost the habit and better live simply. 

Leave a Reply

Your email address will not be published.