Would you like to take advantage of current credit market opportunities? Should credit for debt repayment by rescheduling realize interest savings?
Then check your credit prospects. A successful rescheduling saves money and facilitates debt service
Remuneration loan – in a nutshell
- A successful rescheduling puts the finances on new, secure legs
- Save expensive lending rates immediately and relieve your budget
- Compare to loans at the current interest rate
- Apply for your loan request – without any risk – right now in the loan calculator
Credit for debt repayment – priority of debt restructuring
The priority of any debt rescheduling is the medium to long-term debt reduction. Lower monthly rates, far below the actual installment payment ability, would be the wrong signal.
Planning credit for debt repayment by rescheduling is always based on the shortest reasonable maturity. An optimal debt repayment takes place only if the repayment portion of the installments is as high as possible.
Despite generally low interest rates, compound interest has a significant impact on borrowing costs for very long maturities. Excessive terms (120 months) also offer only a few banks.
In addition to the reduced selection of potential lenders, the interest rate rises noticeably above 84 months. The required credit for debt settlement appreciably increases.
In the planning phase, so that credit for debt repayment has a lasting positive effect, it is recommended to carry out a statement of liabilities. The main priorities for debt rescheduling are short-term loans, such as the disposition or credit card credit.
In addition, there are current payment obligations that have not yet been compensated by a short-term loan.
Recalculate existing installment loan – what should be considered?
It is basically possible to install installment credit on installment credit. However, as an old proverb says, “many dogs mean the death of the rabbit”.
The same is true if too many installments are spread throughout the month. Maybe not the same, but eventually the budget does not go smoothly.
The almost inevitable result would be an increase in the recent disposability or the switch to other short-term loans. Overall, the installment rate should not be so high that the household budget can no longer flexibly respond to additional cash requirements.
The easiest way to settle the bill is to have all appropriate installment loans and existing short-term credit in a loan for debt settlement. Nevertheless, it would be wrong to follow the lawnmower method.
Not every existing installment loan is suitable for rescheduling. In principle, premature loan repayment of consumer credit is permitted.
But, the loan repayment can lead to damages for lost interest income. On top of that, not all costs that are hidden in the loan amount can be settled on time.
Credit debt despite RSV – always a bad deal
If credit for debt relief is to be taken literally, loans with residual debt insurance (RSV) are to be excluded from the rescheduling. The reason for this lies in the insurance contribution.
It is usually integrated in consumer loans in the loan amount. Only a few borrowers know at the time of signing the contract how expensive the insurance cover is.
As a realistic “thumb value” about 10 percent of the loan amount, always per borrower, for the RSV. For two-person credit, not unusual for married couples, ie 20 percent of the loan amount.
Starting from 10,000 USD net loan, it is roughly 2,000 USD for the insurance. If 5000 USD of credit are to be redeemed prematurely by rescheduling, many forget the current RSV.
It is not transferable to the new loan and is not counted back. The policyholder gives up his insurance cover without reimbursement of any remaining risk. In the example 5,000 USD transfer fee, 2 borrowers remaining, the insurance share is 1,000 USD.
By a low-interest loan for debt repayment by rescheduling 1,000 USD to save interest is virtually impossible.
Which installment loans are worthwhile for rescheduling?
“Young” installment loans are not only very low interest, but at the same time often free of charge to pay off. Credit insurances are offered by most banks as an option.
As more and more borrowers pay the costs of RSV, they finance without insurance. If both points come together, the current installment loan is found, which should definitely be integrated into the loan for debt settlement.
A second focus is on existing loans, which are already paid very far. Possible damages keep within manageable limits. In view of the sustainability of the debt rescheduling, some extra USD would have to be dealt with.
On top of that fits the installment, already long time served installment loans, long ago no longer the original sum. The side effect of simultaneously reducing current installment payments through the debt repayment loan is often desired.
A lot of impact, in terms of reduced installment load, shows the rescheduling of well-paid loans. Due to the repayment already made, the installment is in disproportion to the remaining debt.
Rearing the small remainder of the debt repayment loan hardly increases the financing costs.
Credit tip – find a debt rescheduling loan
The search for suitable regular loan offers for rescheduling facilitate free credit comparison calculator. Which of the offered debt rescheduling loans could fit the personal credit rating is explained by the free credit bureau self-disclosure.
It allows unequivocal conclusions about the current personal creditworthiness.
Debt repayment through rescheduling – use free help
Not everyone is comfortable with the sound planning and implementation of sustainable debt restructuring. Creating the optimal conditions for debt repayment would, in difficult cases, be better off with professionals.
In case of doubt, it is always better to seek advice than to take the risk of landing in the debt trap. Aid offers could come from credit intermediaries.
However, consumer advocates advise against this possibility. Some intermediaries try to earn through consultancy contracts, regardless of the outcome of the consultation. Others can not objectively advise because their earnings are linked to the credit brokerage.
Free assistance provided by real experts who do not need to earn the advice comes from charitable organizations. Non-profit debt counselors show the ways that save in individual cases, credit costs, keep the installment payments compatible and lead to debt relief.
Remortgage loans – credit in difficult cases
In principle, loans from banks or from private sources are eligible for debt rescheduling with the aim of debt repayment. Banks may only grant the rescheduling loan if the proof of credit no doubt excludes greater credit risks.
A rescheduling of regular installment credit on risk loans is also to be advocated only in individual cases. Realizing credit for debt repayment through risk loans leads to significant interest premiums for virtually all providers.
An actual saving can only be realized if extremely expensive old loans were rescheduled. Risk credit is almost at the interest rate level of a regular loan.
Significant savings would be possible with short-term loans via credit cards as well as the repayment of an existing Eicredit. One possible loan for debt repayment with increased credit risk would be, for example, the extra credit of the Credither from the affiliated credit comparison.
Private-to-private risk credit could be perceptible through both Smava and Auxmoney. Both credit bureaus have an excellent reputation for serious credit brokerage.