Would you like to “clean up” and merge various loans? – Or do you need a specific debt rescheduling of a certain liability?
The timing of your debt restructuring would be well chosen. We support your loan search with offers and information. Learn how you can optimally reschedule debt, avoid mistakes and solve problems.
Debt Settlement Loan – Use Interest Rate Policy
Different key figures determine how expensive a debt settlement loan is for borrowers. The general interest rate level for long-term debt rescheduling is based on the key interest rate of the Good Finance. The key interest rate has apparently only known one direction for years. It falls and falls. However, the key interest rates will hardly be able to fall further. Banks have long paid no interest for refinancing their consumer loans.
On the contrary, they even have to pay interest to the Good Finance for “parked money”. Initially, only short-term installment loans and mortgage loans benefited from the lack of interest. Today, banks offer regular loans with very long terms at low interest rates. A sober look at interest on savings shows even more effects. For some time now, savers have actually no longer received any interest.
What is new is that the first credit institutions are openly thinking about the negative interest rate for savings. The signs could not be more favorable when looking for a loan to settle debt. Interest rates are at an all-time low for both regular loan offers and private loans. Those who hesitate now run the risk of giving away their advantages. The inflationary Good Finance policy cannot go on forever.
Plan debt restructuring cleverly – what should you watch out for?
Every debt restructuring pursues a primary goal – medium-term or at least long-term debt relief. In addition, there are secondary objectives, such as the liquidity gain by realizing the repayments already made and by adjusting the term. The low interest rates of the present promote debt rescheduling options, especially with larger financing amounts and longer terms.
However, debt restructuring does not work according to the “lawnmower method”. Refinancing must pay off so that the goal of debt relief can be achieved as cost-effectively as possible. Converting short-term loans, overdraft facilities or credit cards into an installment loan always pays off. The situation is different if existing installment loans would have to be repaid. The additional contracts, explicitly credit insurance, are decisive.
In order for the loan to pay off the debt optimally, only installment loans should be combined whose loan costs are calculated back to the day of the repayment date. This is not the case with credit with residual debt insurance (RSV). The insurance premiums were usually co-financed, but are not calculated back. Debting such a loan means giving away cash.
Special case – credit with residual debt insurance
Residual debt insurance is worth protecting the family, because in the event of unemployment, the installment is paid by the insurance. However, insurance coverage was only granted for a specific loan. If the credit risk disappears because the loan was replaced by debt restructuring, the contributions already paid are lost. How much money that is can be roughly estimated from the transfer fee.
Around 10 percent of the remaining debt per borrower corresponds to the co-financed insurance premium. If $ 6,000 insured loan were rescheduled, around $ 600 would be lost. “Retrieving” this money by saving interest is almost always impossible. The “unused” contributions would also not be transferable.
With regard to the primary goal of achieving debt relief, insured loans should only be rescheduled in an emergency.
Selective debt restructuring – with a good credit rating
If borrowers are looking for debt rescheduling of individual payment obligations, high overdraft is the most common reason. Anyone can get into the dispo trap. The overdraft facility creates liquidity when somewhat larger invoices are in the mailbox. At the same time, it encourages people not to sacrifice consumption even at low tide in the household budget. If you have a good credit rating, you don’t have to look for a suitable loan to settle your debt.
Free loan comparisons on the Internet show the way to a low-interest debt rescheduling loan quickly and easily. A typical mistake that borrowers quickly commit is to choose a term that is too short. The disposition would initially be put in its place. But, without a liquidity reserve, the red numbers quickly appear on the account statement.
It is better to plan the loan to settle the debt with small installments, but to replace it early by “saving”. The advantage of this method is that only low regular payments are firmly agreed. If the household budget can make higher payments, the money flows to a savings book for “temporary storage”. If there is a shortage in the checking account, the reserve protects against red numbers.
Debt restructuring with poor creditworthiness – finance fairly
Debt rescheduling does not only arise with excellent creditworthiness, but much more often when personal creditworthiness for lending is restricted. In this situation, it becomes difficult to grant low-interest bank loans to repay debt. Optionally, bank loans with risk interest premiums or loan offers from private customers could be considered.
A loan to settle debts from private, serious brokered by Cream bank doesn’t have to be expensive. Current savings book conditions literally push savers into alternative investments. Seriously valued lending is one of the manageable investment risks from an investor’s perspective.
Certificates make it easier to secure lending based on professional indicators. The bidding process allows investors to share the risk. Under these circumstances, a low-interest loan to settle debts remains possible even if bank loans were refused.