Should you make a loan to make up a bank overdraft?

 

The bank overdraft can be recovered very quickly with a consumer credit of the renewable or personal type but is it really the best solution? Not so sure.

Credit for bank overdraft

Credit for bank overdraft

Many households think of credit to make up for their bank overdraft and thus avoid agios repeatedly. It is efficient, fast and the accounts quickly return to green, but this solution has consequences: increasing the debt ratio, increasing the amount of monthly payments and therefore monthly charges.

Objectively, using a loan to make up a bank overdraft only makes matters worse. Certainly, the bank overdraft is filled in the short term but in the long term, the situation will return to the starting point, if not worse since the share of monthly payments will increase. The solution may come from another credit transaction, that is to say, the consolidation of loans.

Credit consolidation to rescue the overdraft

Credit consolidation to rescue the overdraft

The principle of credit grouping is to consolidate all the loans in the household into one, which allows the new lender to extend the repayment period and reduce the amount of monthly payments. Thus, the monthly share dedicated to loan charges is reduced (sometimes up to 60%), which avoids ending the month short.

The consolidation (or repurchase) of credit can also include an amount dedicated to a new project, which will allow the passage to fill the bank overdraft. Good to know, this operation can lead to an increase in the total cost of the credit. Simply, by readjusting the loan charges to the household’s financial situation, the latter finds a balanced budget and avoids difficult ends of the month.

Overdraft credit for overdraft: simulate now

Overdraft credit for overdraft: simulate now

This operation offers an improvement of the situation in the long term with a very effective readjustment of the amount of the monthly payments. In addition, the new project will fill the short-term overdraft.

The simulator below lets you know if the project is feasible according to your current situation. A field provides for entering the amount of the current overdraft. A first estimate of the monthly payment will allow you to get an idea of ‚Äč‚Äčthis operation. The simulation is free and without obligation.

Prepare for a birth with a credit buyout

 

Are you going to welcome a newborn baby into the household but do not know how to finance the arrival of this baby? Credit consolidation is an effective alternative.

Buy back credits, prepare for baby’s arrival

Buy back credits, prepare for baby

A birth is an event filled with joys but also with worries. As informed parents or young parents, the question of financing this upcoming arrival is a source of questions, especially when the household already has credits in progress.

The grouping of credits precisely makes it possible to combine the various loans into one, which makes it possible to lengthen the duration of repayment and to reduce the amount of the monthly payments. It is also possible to add an amount dedicated to purchases planned for baby, it is optional.

Finance the birth budget

Finance the birth budget

A birth budget is calculated, that is to say that it is necessary to calculate the total of the planned expenses to be able to find a financing solution, whether savings, credit or repurchase of credit. There are therefore several types of expenses to plan for: food, hygiene and care, clothing, toys, furniture, equipment, health and others.

For food, you need between 3 and 4 cans of milk at a price of 20 $ (80 $ per month maximum). For hygiene (diapers, soap, cream), we are about 100 $ per month. Clothes, count 5 $ per bodysuit and pajamas, only about 100 $ for the first 6 months. The early learning, rattle and mobile toys will cost around 40 $. Furniture (bed, wardrobe, changing table and others), around $ 500. The equipment (baby carrier, bottle, bottle warmer, cooking, bibs, high chair, pram, stroller, playpen, car seat, etc.) around 800 $. For health (visits once a month, vaccines, illnesses), the pediatrician’s fees are at least $ 28.

Savings, credit or buy back baby credit?

Savings, credit or buy back baby credit?

In total, the birth budget for the first 6 months can reach: $ 480 + $ 600 + $ 100 + $ 40 + $ 500 + $ 800 + $ 168 = $ 2,688. If the household wants to save, they will have to put $ 298 aside each month, an amount almost impossible for the majority of people.

Credit is also a short-term solution, especially with the offers of unassigned personal loans. If the household already has loans in progress, there is no risk of accumulating yet another loan, as much to finance the project by including it in a grouping of loans. To simulate this project, it’s free and without obligation. Just complete the simulation form, the result is very fast.

Are the costs of loans more and more expensive? How it works ?

For the past two years, a historic drop in interest rates has been observed on the credit market, more specifically mortgage loans. Unheard of as some specialists would say. After a slight increase in 2017, a further drop in the gross rate is observed in 2018. What motivates people wishing to embark on a project requiring funding.

Bank interest rate: understanding how it works

Bank interest rate: understanding how it works

A loan is made up of several elements. In addition to the capital borrowed, the bank adds the interest rate and various fees including, in particular, administration fees, insurance, guarantees and prepayment penalties.

In this whole lot, it is mainly the interest rate that costs the most to a borrower. Its calculation is made on the basis of several factors: the bank’s margin, the credit manufacturing costs, the risk premium (software, employee compensation, etc.) and finally the rate of the financial markets. The latter is based on the key rate applied by the European Central Bank.

Note that in terms of credit, there are different types of interest rates

Note that in terms of credit, there are different types of interest rates

The most classic is represented by the fixed rate which, as its name suggests, remains unchanged throughout the life of the loan. It is recommended for long-term loans and is calculated on the basis of the 10-year Treasury Bond (10-year OAT). The variable rate can go up or down depending on the market.

Which makes it both beneficial and very dangerous. This is why the banks have created the revisable capped rate which is limited by a ceiling in the event of too large an increase in the market rate. Note that this rate is indexed for its part on Euribor.

Rise or fall in the interest rate?

Rise or fall in the interest rate?

In the mortgage market, rates fell sharply. The most historic drop was observed in November 2016 when they forecast 1.31% whereas a year before, they were still 2.28%. In August 2017, a small rise of 1.57% was felt. And in 2018, the crude rate plunged again to 1.48% in July.

All this to say that the rates are currently very low. Will this trend continue? Not so sure. The European Central Bank has in fact expressed its desire to end its policy of low key rates, which will necessarily increase lending rates. Borrowers should expect to pay more for their loans.

Despite this situation, they should not only bet on a low interest rate to have a cheaper loan. Let’s not forget that the cost depends not only on the interest rate, but also on the duration of the loan, the amount borrowed and the risk profile. We must therefore already think about taking good care of your file. And to easily find a loan, there are all kinds of credit simulators that you should not hesitate to use.

Can we get a mortgage with an LOA in progress?

Leasing with an option to buy is a contract assimilated to consumer credit, taking into account the rent is therefore identical to that of a car loan. Borrowing is therefore not so simple when you have a current LOA.

LOA: principle and impact on debt

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Leasing with purchase option is a contract which makes it possible to rent a car and acquire it at the end of the rental period, a purchase option is defined at the outset and allows the motorist to become vehicle owner if desired.

Simply, the LOA is financed by consumer credit, this means that it will impact the debt capacity of the subscriber and if the latter wishes to embark on a real estate project, he will eventually encounter some difficulties in obtaining its financing.

The banker will, therefore, study the plaintiff’s situation and take into account his rent, you should know that we can go into debt up to 33% of his income, beyond that, the bank will not accept to release the funds for the mortgage applicant.

If the LOA’s rent is too high, then financing cannot be set up because the applicant’s repayment capacity will not be sufficient, which completely calls into question the real estate purchase project.

Solutions for obtaining a mortgage

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If your LOA does not allow you to take out a mortgage, you must then consider several solutions to end the rental contract with an option to buy:

  • Redeem vehicle / contract
  • Transfer LOA to another person

Important: it is not possible to terminate an LOA contract since it is assimilated to a consumer credit contract, therefore, it is necessary to find other solutions to disengage.

Have the vehicle / LOA contract redeemed

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The lease with purchase option plans from the 13th month a purchase option for each month following the far end of the contract and the final option. Therefore, it is possible to purchase the vehicle from the 13th month.

Either the motorist can buy the vehicle himself, by his own means or through a credit buyout for example (he becomes the owner automatically and the contract ends), or he offers to another motorist to buy back (the buyer pays the amount of the purchase option to the lessor and automatically becomes the owner of the car).

Transfer the LOA contract to a third party

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One of the least expensive solutions is to use the principle of the transfer of leasing, it is to find an interested person to take over the current contract and the vehicle.

We simply change the tenant, a takeover file must be submitted to the lessor, who will carry out a credit study.

On the cost side, the buyer will simply have to pay the transfer and update fees for the registration card. It is advisable to use a leasing transfer platform to quickly find an interested buyer.

Rates, credit and credit buy-back: unheard of for 70 years

Rates continue to fall, beating their record highs, in March 2016 the levels observed were never as low as at the end of the Second World War, enough to awaken the desires for credits and household credit repurchase.

Home loan: lower rates and feasible projects

Home loan: lower rates and feasible projects

The housing credit observatory assesses the level of rates practiced in the production of mortgage loans on the French soil each month. For the previous month, production increased by 26.8% compared to March 2015, which suggests a crazy year in terms of credit and low rates.

Over 15 years, borrowers managed to obtain rates on average of 1.73% over 15 years compared to 1.90% in February 2016. Over the 20 and 25 year terms, the rates increased from 2.17% 1.99% and 2.52% to 2.34%. In other words, all levels have fallen to offer French households good borrowing capacity.

The more the rates are reduced and the more the borrowing capacity swells, so a borrower will be able to carry out his project and will be able to benefit from a larger envelope, whether for the purchase in the old, the purchase in the new or to invest in rental, an emerging trend.

Credit repurchase: savings at the end

Credit repurchase: savings at the end

The rates in the repurchase of credit are not the same because it is necessary to take other factors like the change of direct debit, the negotiation with the banking actors and the insurance which can represent a significant cost. In this month of March 2016, the rates remain lower and close to those practiced for the mortgage, what to realize great savings if the loan was contracted between 2008 and 2010.

Whether in renegotiation or in pure credit repurchase, the conditions are there and some households having renegotiated in 2014 see in 2015 are thinking of having their home loan repurchased a second time, vigilance is required because the share of costs of the operation can be a serious obstacle to the operation. It should be borne in mind that for this type of operation, the gain of money is necessary otherwise the borrower has no interest in using it.

Regarding the grouping of several loans in one

loan consolidation

Rates also fell for the second quarter, whether within banks or on banking intermediation networks, attractive conditions that can reduce the increase in total cost which will provide households with a smaller and more suitable monthly payment.

Whether for mortgage, renegotiation of credit or repurchase of credit, we offer you a free online simulation with the search for the best financing offers on the market.

Credit for the people, how does it work?

 

 

Following a credit that went wrong, the people who find themselves stuck in banks can still access bank loan offers. Having become an important player on the market, lender offers privileges to borrowers looking for a secure situation. Everything about this system.

Personal loan and credit , competitive costs!

Personal loan and credit , competitive costs!

Without being of nationality, the borrower has all the chances to access a credit with the banking establishments of the country, and this, without passing by the  banks.

As a potential player on the financing market, lender allows credit seekers to benefit from secure formulas. However, higher costs will have to be foreseen, especially with the short-term loans and the small sums of money granted within the framework of a personal loan at very competitive prices which make the reputation of lender.

With regard to home loans or car loans, which require a larger sum, the costs are comparable to those offered by banks.

What type of credit for the people?

What type of credit for the people?

Before taking out a loan in a foreign country, it is important to learn about the laws in force and the formalities required for each type of loan requested. By doing so, you anticipate all the conditions of allocation and the consequences of such a commitment. Among the forms of credit that a people person may be entitled to from a bank, you have among others:

The installment loan

The installment loan

Granted without proof of use, the installment loan provides you with a sum of money which can be used to build up a reserve of money, buy a new car, carry out renovation work or buy movable property.

With this form of personal loan, the interest rate, the cost of the monthly payments and the duration of repayment are fixed in advance in the contract. For your part, you have access to all the information necessary to allow you to better manage your debt budget and avoid bad credits as was the case in the country.

Mortgage credit

Mortgage credit

To acquire real estate , the people can take out a mortgage, and this, with the same principles of repayment applied in the country. Thus, if the borrower fails to repay the money, the bank reserves the right to foreclose on the house or apartment.

To avoid getting there, it is important to always study the terms of the contract and know in advance the cost of monthly payments and the duration of repayment. Especially since there is no bank guarantee and the mortgaged property becomes the property of the lender.

Credit repurchase

Credit repurchase

Adapted to borrowers who want to escape from a situation of over-indebtedness, the repurchase of credit carried out applies all the rules in force in the country. To do this, all the outstanding loans will be grouped together to decrease the value of the monthly payments and extend the repayment period.

This repurchase of credit relates inter alia to the personal loans and mortgages of the owners who do not want to be separated from their house. If you want to know more about the loan , do not hesitate to follow this link to know the different organizations and the different credits to which you could subscribe.

Thanks to the presence of numerous people companies and specialized finance companies on territory, the country offers reliable protection against financial and other unforeseen abuses. Especially since the strong competition between banking establishments generates advantages for the people borrower.

Short-term loans: a customer guide for loan companies

As is well known, the offer of the vast majority of loan companies present on the Polish market are mainly solutions such as short-term loans. Does this mean, however, that the modern loan sector is characterized by monotony and the offers of individual lenders do not differ much? In no case! It can be safely argued that in terms of the number of available options and variants, the modern non -bank loans sector definitely outstrips the banking industry.

In addition to the sheer variety of offers available, the ever-growing number of non-bank lenders also deserves attention. Already, the Register of Loan Institutions operating at the Polish Financial Supervision Authority contains almost one hundred different entities, and this number is growing every year. Obviously, such a large variety is not only a favorable circumstance for the customer, but in some cases, it can also be a problem.

Short-term loans: the offer of today’s loan companies

Short-term loans: the offer of today

As a rule, the offer for short-term loans can be divided into two basic schemes:

  • The offer of companies providing promotional solutions ( first loan “for free”, loyalty programs)
  • The offer of companies providing only loans on terms consistent with the standard cost table

Obviously, quick loans belonging to the first of these categories are definitely more popular. Practice shows that customers seeking non-bank financing very often first pay attention to whether a given loan institution offers a promotion entitled APRC at 0%. However, some caution should be exercised here.

“Free” loans are really free, but remember that this is a promotion, not a standard offer. So if we breach the terms and conditions of the promotion (e.g. we repay the loan after the deadline), the lender may require us to repay the liability at standard costs rather than promotional ones. This is not an insidious “trick” but simply a record in the contract we sign before receiving the loan.

Are there short-term loans with no bases?

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You can find a lot of ‘no base’ quick loan ads on the internet. However, it should be borne in mind that at present each and every loan institution always verifies our data in specific debtors’ databases.

Thus, there may be loans without Credit Checker checking or KRD checking, however, loans available with complete omission of checking customer data in databases are a myth.

However, does it follow from the above that the negative credit history, by definition, limits our chances of getting a loan? Not necessarily. Some lending institutions have a more flexible policy in this area, focused primarily on assessing the client’s real financial capabilities, and not their credit history.

Therefore, it is worth carefully reading the documentation made available by loan institutions as well as the tabs entitled Questions & Answers.

Are short-term loans and payday loans one and the same?

Are short-term loans and payday loans one and the same?

The answer to the above question is: not necessarily. It can be said that payday loans are always short-term loans, but short-term loans are not always payday loans.

The market also offers installment loans with a repayment period of e.g. 3 or 4 months, i.e. 90 or 120 days. In this case, however, we are not talking about ‘payday loans’, because the constitutive feature of the latter is that the liability is repaid once, not in installments.

Long-term loans: key information

Loans with repayment in installments undoubtedly constitute a segment of the offer of modern loan institutions less known to clients. By default, we associate the loan sector primarily with solutions such as popular payday loans, which are simply quick, simple loans for small amounts.

However, it is worth being aware of the fact that the offer of today’s loan institutions is very often also long-term loans. What’s more, both the maximum available loan amounts and repayment periods for some companies can be at a really high level, comparable even with the offer of consumer loans in banks.

What is worth knowing about non-bank long-term loans?

What is worth knowing about non-bank long-term loans?

Do customers often wonder to what extent solutions such as long-term loans resemble much better-known payday loans in terms of their specifics? To illustrate the mechanism of installment loans, however, a comparison with consumer loans at banks will be much more adequate. Repayment takes place, as the name implies, in installments, and not by a one-time refund of the entire borrowed amount.

In the case of installment loans, the process of verifying the creditworthiness of a potential customer will be a bit more similar to procedures similar to bank loans, than the verification we take before taking a payday loan. This is of course not an iron rule, but we can expect that when applying for an installment loan the lender will want to check our financial situation more thoroughly.

Does this necessarily mean that additional documentation, such as an income certificate, is required? Not necessarily. Currently, tools such as Instantor or Kontomatik are becoming more and more popular. Theoretically, they serve primarily to verify the customer’s personal data. In fact, apart from our personal data, the application also downloads the bank account history. In this way, the lender obtains easy and, most importantly, highly credible insight into the state of our personal finances.

What else is worth knowing about long-term installment loans?

What else is worth knowing about long-term installment loans?

Contrary to popular belief, having a bank account is not an iron condition for getting an installment loan from a loan institution. Currently, quite a lot of lenders also offer the option of paying out the loan amount via a check. However, it should be remembered that in such a situation also repayment of loan installments will take place without a banking circuit.

Is it possible to get installment loans completely online? The answer is yes, but this will not apply to all loan companies. What’s more, in some cases it may be necessary to contact a company advisor in person, even if theoretically the offer is available online. Most often this happens when the assessment of our creditworthiness has yielded an ambiguous result.

Some loan companies offer customers the option of credit holidays or extending the duration of the loan. However, this is also by no means the rule. Before choosing a specific installment loan offer, it is good to carefully read the documentation that the lender makes available on its website.