To finance large purchases like a car or a motorcycle, you sometimes have to resort to loans. The accumulation of conventional as well as renewable credits has harmful consequences since the debt ratio increases. Too high a debt ratio decreases purchasing power . Consequence: the indebted household is taken by the throat no longer being able to properly meet its personal needs. Is there a solution to get out of this downward spiral?
Manage your monthly budget
When it is difficult to finish the end of the month, it is imperative to look for solutions to increase your income while reducing your expenses. This research begins with the management of its budget . We must try as much as possible to set a monthly budget to respect. For example, you can restrict your food budget and your leisure budget for a few months. You can also try to save money on various insurance ( home insurance, vehicle insurance ). Unfortunately, with a debt ratio approaching 33%, these little ideas for saving money are not enough.
Turn to financial organizations
Financial organizations are at your side. They offer to support you in your project by offering you a financial product ; the repurchase of credits.
The repurchase of credits : what is it? Credit or banking institutions believe that having a single loan in a single organization allows indebted households to better manage their budget . In fact, to put this thought into practice, they offer the possibility of bringing together all the classic credits ( auto loans, personal loans, etc. ), revolving credits ( revolving credits with store cards ) as well as unpaid and bank overdrafts in a single loan. This is the very principle of the redemption of credits.
Some financial organizations are specialized in renegotiating mortgage loans . Others simply suggest consolidating consumer credit . It is therefore necessary to analyze your situation by making a statement of your finances before opting for this financial solution.
What are the advantages of the repurchase of credits?
The repurchase of credits has a real positive impact on the budget of a household in debt. It will allow:
- To have a single monthly payment to repay (excluding the monthly mortgage payment) to a single organization. Mechanically, budget management is simplified.
- To have a new loan at a single rate . The rate as well as the duration of the new loan are defined in the loan offer.
- To have a lower monthly payment . The duration of the loan is extended which makes it possible to reduce the amount of the monthly payment.
- To have a decreasing debt ratio.
- To regain purchasing power and to live better.
Having recourse to a repurchase of its consumer credits also makes it possible to open rights to a new credit to finance another project ( loan for work or to buy a vehicle… ). In this case, the new credit is incorporated in the amount of the repurchase of the credits .
Be careful, however, it is advisable to no longer have recourse to consumer loans after having obtained a repurchase of credits at the risk of falling back into debt.
Who can have the right to a repurchase of the credits?
The agreement of the repurchase of credits will depend primarily on the level of debt of the applicant. To do this, the advisor will determine his solvency from household resources and charges . It is only after having made calculations that he can refuse the request or grant this right. Purely as an indication, the debt ratio must be less than 40% to benefit from a loan buyback.
Solvency is not the only condition. The financial expert will also analyze the professional and personal situation. In fact, it is easier to obtain a loan buyback when you are hired and if you are under 60 years old.
Finally, be aware that households registered in Bank of United States can benefit from this device provided they are registered for incidents of repayment of credits.