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Make a cheaper real estate loan redemption online.

 

 

Alleviate debts with the repurchase of mortgage

Alleviate debts with the repurchase of mortgage

Regarding any application for real estate credit, the financial institution makes a point of honor to check first the level of indebtedness of the borrower. This level of indebtedness is defined by an average rate of 75%. And when you reach a threshold of excessive debt, it is wise to use a mortgage loan redemption to reduce its monthly payments.

Repurchase loans to reduce monthly payments

In case of accumulation of debts choking your budget and limit your spending to the daily, a real estate loan redemption will be very useful to rebalance your budget balance. The real estate loan buyback allows all individuals to pay their debts by grouping them into one and the same loan benefiting from lighter monthly payments, a lower interest rate and a longer repayment period.

Repayment facilitated with the repurchase of loan

Repayment facilitated with the repurchase of loan

The loan buyback, which can include any type of credit, therefore allows the borrower to improve its terms of repayment in order to regain a certain balance in its financial capabilities on a daily basis.

Loan purchase

The repurchase of real estate loan makes it possible to reunite the credits of a borrower, established at a single fixed rate on a new period of refunding. A loan agency buys your loans and especially your mortgages.

Get your mortgage at the lowest rate

To get the best buy back of real estate credit, you have to compare the offers. Whether you are buying a home equity loan or a real estate loan buyback with various credits, compare the rate, amount, duration and fees. Make the total of the monthly payments, the capital remaining due, the amount of your debts, the amount of free cash. You will thus have all the keys to check if a redemption credits is interesting, and if so, which one.

Purpose of repurchase of mortgage

Its assets are numerous:

  • A lower monthly payment
  • One and only organization
  • Easy management of your accounts

Best Offer Redeeming Real Estate Loan

Best Offer Redeeming Real Estate Loan

When you want to apply for a buy back of loans, do not hesitate to play the competition between several financial organizations in order to benefit from the best offer of redemption possible. Also, it is interesting to use a broker who will be able, thanks to his experience, to negotiate for you the most advantageous offer.

  • real estate buyout
  • mortgage repurchase
  • zero rate loan redemption
  • borrowing redemption simulation

 

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Why a credit redemption is more advantageous the first years?

How is the repayment of interest distributed throughout the loan?

How is the repayment of interest distributed throughout the loan?

The vast majority of mortgages are amortizable. The peculiarity of this type of loan is that the maturities are identical throughout its duration. This distribution of interest has the effect that the monthly payments of the first years only reimburse a small part of the capital in exchange for a large part of interest.

Take the example of a loan of 150,000 euros over 15 years at a rate of 1.5% (excluding insurance) with monthly payments of 931.11 euros. The interest share breaks down as follows:

  • 1 st year: 180 euros/month
  • 6th year (same monthly payment amount): +/- 100 euros

The purpose of a loan buyback is essentially to take advantage of lower interest, it is strongly recommended to use it in the early years of its loan to achieve real savings and buy the mortgage at the best rate.

Credit buyback: savings for sure?

Credit buyback: savings for sure?

To find out if your credit redemption is financially attractive, factors other than borrowing rates should also be considered:

  • Compensation (IRA or PRA) for early repayment. For a home loan the indemnities amount to 3% of the outstanding capital, capped at 6 months of interest. Since the Cogilaw Act, IRAs can also be applied to depreciable consumer loans, beyond a threshold of 10,000 euros of prepayment per 12-month period;
  • Application fee;
  • The cost of raising the potential mortgage related to the old credit and the fees of the one required with the new loan.

How to get a credit redemption easily?

How to get a credit redemption easily?

Many organizations offer credit buy-back offers, each with its own acceptance criteria: maximum debt ratio, amount of household tax income, as well as the balance to be lived after deduction of the new monthly payment, etc. To know which one to choose according to your profile, do not hesitate to consult the opinions of consumers and to make play the competition.

To lower your monthly mortgage payments, also consider the borrower insurance change. The Cogilaw Company allows you to subscribe whatever you want, so play the competition!

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Lender

Installment loan – special form of financing.

A repayment loan is a special form of financing. With this loan, repayment installments of the same amount are paid over the entire term. The loan is well suited for all people who value planning. The term of the loan is much shorter than, for example, an annuity loan.

This creates some benefit for the borrower. In the course of and through the permanent repayment, the interest rate decreases in relation to the annual amount of the repayment amount.

Info:
Such loans are particularly useful for real estate and mortgage lending. Over the entire term, the installment fees are getting smaller. For this reason, pay-off loans are very popular.

Advantages and disadvantages of the payment loan

Advantages and disadvantages of the payment loan

A big advantage is that the interest rates on a repayment loan are often very favorable. Every user can enjoy a constant repayment installment. This makes the monthly budget planning easier and the residual debt is reduced very quickly.

This has the advantage that the interest payments continue to decrease. Especially with a long-term real estate loan, this form of loan has been proven for years. By contrast, the initial burden is somewhat high due to the higher repayment rates.

Note:
As a result, the monthly rate only decreases constantly over a certain period of time. As a result, every user needs to spend a little more money earning their first monthly installments.

Why is the loan so useful for mortgage lending?

Why is the loan so useful for mortgage lending?

For mortgage lending, the advantage lies in the fact that the user pays his bank a monthly repayment installment and the interest due on it. Each repayment rate reduces the residual debt and also reduces interest rates.

As a result, monthly installment mortgage rates are becoming smaller and smaller. For this, higher installments must be accepted at the beginning of the term. As a result, this form of loan is particularly well suited for conversions and additions to own real estate.

Info:
Particularly well-earning people use this loan for mortgage lending. Before signing the credit agreement, a credit calculation should always be carried out. For the determination of the right loan the personal circumstances as well as the financial condition play an important role.

What condition is required for this loan?

What condition is required for this loan?

The applicant must have reached the minimum age of 18 years. In many cases, the minimum age for a repayment loan is even raised by banks or banks to provide a higher level of security.

Minors have little chance of such a loan. The residence of the applicant must be in Germany. It is important that this is the main residence. Many banks also require a bank account in Germany. This account will be used as the reference account to which the loan amount will be transferred.

Note:
The most important requirement for granting the loan is, of course, the creditworthiness. The creditworthiness of the applicant is checked by a credit bureau query. It calculates the relationship between the applicant’s income and expenditure on all accounts.

If the monthly income is higher than the applicant’s expenses, there is a good chance of a pay-off loan. If other loans have to be serviced already, this chance drops a bit. Often a mortgage loan is accepted as an additional security for the loan. For the mortgage, the name of the applicant must also be found in the land register.

Example calculation for a payment loan

Example calculation for a payment loan

If, for example, a customer pays a loan of 20,000 euros, a term of five years or an interest rate of 10%, services amounting to 1,000 euros and 2,000 euros interest are to be paid in the first year.

Info:
Even in the fifth year, the repayment remains at 4,000 euros, but the interest is minimized to 400 euros. For a borrower to more easily decide which form of loan is cheaper, the terms should always be compared exactly. However, it is clear that the loan is much cheaper at the same maturity and interest rate than an annuity loan.

If it is a loan of 1 million euros and the term is two years, the borrower pays at a 3% interest rate loan rates of 30,000 euros and a repayment amount of 500,000 euros in the first year. For the second year, the rate remains at 500,000 euros. Here, however, only interest in the amount of 15,000 euros will be charged.

Note:
The examples show that the accrued installment always consists of the linear repayment installment and the interest calculated from the residual debt. As a result, the repayment share always remains the same.

5 tips for a payment loan

5 tips for a payment loan

1. Compare prices

Before concluding a credit agreement, the prices and terms should be compared exactly. Every loan offers advantages and disadvantages. Special attention should always be paid to the repayment of installments and the amount of interest.

The installments always consist of interest and repayment as well as any fees. The repayment is needed for the repayment of the loan amount.

Info:
The costs and commissions incurred in financing the loan are paid by the fees and interest. With a good credit, the installments should always be calculable and the monthly burden low.

2. Use maturing or maturing loans

In the case of a so-called bullet loan, the interest is always paid by a one-off payment. During the repayment phase, only the interest will be repaid. The redemption portion is saved as part of the repayment vehicle as a life insurance policy.

This is done through funds or a savings plan. If enough money has been saved, it can be used to pay off the loan. A big advantage of this loan is that the contributions can often be saved for tax purposes.

Note:
A minor disadvantage is that the interest burden always remains unchanged during the loan term. This is mainly because it does not minimize the residual debt.

3. Loan with a constant repayment

Loans with a constant repayment offer a constant repayment rate during the repayment phase. This has the advantage that the interest is calculated only for the remaining debt and thus the monthly burden is less and less. The residual debt is reduced and the monthly rate sink.

The repayment share remains the same. Accordingly, at the beginning the monthly burden is very high. In finance, this variant of the repayment next to the real estate financing is the norm. Often, banks and borrowers often resort to annuity loans on real estate.

Info:
For rented buildings, maturity loans are an option. Banks seldom offer such loans in the private sector.

4. Find the right bank

Before concluding the loan, it is important to find the right bank for the loan. If the repayment loans are burdened with an entrepreneurial profit, the borrower is much better off with an annuity loan. In any case, it is important that the loan fits the borrower.

After all, not every borrower is able to pay higher installments in the first year. Especially in the construction phase, many real estate financiers calculate with moderate installments per month. After all, unforeseen expenses can occur time and again, especially during the construction phase.

5. Special repayments should be possible

A special advantage are loans that do not exclude a special payment. If a variable interest rate has been agreed between the bank and the borrower for a loan, special repayments are available at any time.

If a fixed interest rate has been fixed in the contract, it is only possible to make a special payment if they are specified in the contract. Otherwise, there are fees for a special repayment, which make a complete repayment of the loan at once not worthwhile. If a loan agreement is terminated prematurely, the borrower often has to expect a prepayment penalty. The fee amount is determined by law.

Note:
A classic repayment loan can be terminated in the rules after a ten-year term at no additional cost.