Consumer loans is made out by a huge number of people, crediting became generally available, and the market of banking services inevitably develops. Thanks to this development in the market of credit services there is implementation of different new credit programs, and conditions of loan granting change for the better. Therefore the borrowers who issued the credits earlier on other less favorable conditions, for example, by the size of an annual interest rate understand over time that it would be quite good to be refinanced to lower the financial loading. Certainly, the principal debt will not get to anywhere, but here percent perhaps on it can be quite reconsidered.
What is the credit
the Credit is the amount of money which you a beret at bank, on the needs on a certain period with a certain interest rate. The credits happen three types:
• A mortgage loan - on purchase of ready or storyashy housing
• A consumer loan - for personal needs, happen without pledge or to pledge of personal and real estate. Can it is made out both on yur the person and on the physical person, with the guarantor or without.
• A car loan - the credit given on purchase of the car new or second-hand on the security of the vehicle.
Difference refinancing from the credit
the Difference of a consumer loan from refinancing consists in design of the new loan agreement, for the purpose of receiving the new credit for cancellation of earlier taken loan or consolidation of all your debts in different banks in one and makes one payment, the smaller amount of one financial ucherezhdeniye. In other words, it is transition of the borrower to other terms for crediting. And loaning up most often happens to departure of the borrower to other bank as not all banking institutions go for refinancing of the own credits.
Before making up the mind to such important step as refinancing, the borrower should study well loaning up conditions on programs in other banks. It is necessary in order that all procedure was not unprofitable and vain. It is also necessary to study attentively already available loan agreement as according to it can be provided, if not prepayment penalties (similar conditions can be nullified as contradict the current legislation), then restrictive conditions of early loan payout. For example, the right of the borrower to make early cancellation only from the prior notice of bank and only in certain days.
Refinancing of the credit is necessary
Many set it is necessary to refinance the credit whether generally it is worth bothering. When it is necessary to do it:
1. The percent in other bank is one many less than at you on the credit
2. to you reduced salary,
3. when on the credit already honor payment from the sizes as your salary,
4. you had other problems because of which you cannot pay all amount any more or it already became for you a heavy load.
5. When you want to combine all credits in one + it is possible to receive still cash still on top.
the List can be continued long, the reasons can be much.
That will give you refinancing of your debt to bank. You will be able will reduce percent on the credit and will reduce the payment amount due to increase in a credit period. The example at you needed to be paid 3 years the credit, with monthly payment of 25,000 rub, you can refinance up to 5 years and the payment up to 18,000 rub (example) will decrease at you. Also when refinancing it is possible to transfer an outstanding debt to other bank and on top to receive still cash.
Documents on Refinasirovaniya of the credit
When refinancing the credit by other bank the new creditor bank will give to the borrower an opportunity to completely repay the debt to former bank with the purpose there was only one current loan agreement. Refinancing of several credits in one can become very convenient form, it is easier to pay one credit both on periods, and on the amount. It is necessary to tell that the new bank will check reliability of the borrower in due form, i.e. with request of a standard document package, with the appeal to bureau of credit histories and other.
the Package of document which will be requested by bank when refinancing consists from:
• Announcement (personal at each bank)
• Copies of the identity document;
• Help, confirming the income of the borrower;
• documents on the property which is available for the borrower (in case of need pledge designs).
• help about an outstanding debt before bank (not in all cases)
About whether it is worth being loaned up, to the borrower will be better to ask not in bank, and the financial specialist on side. It will be best of all to take the form of the contract and to address the lawyer specializing in this sphere as it on reception will acquaint with all conditions offered to signing of the contract and will explain all surprises which can trap the client.
the idea about refinancing of the credit would not seem tempting to the borrower, it is necessary to understand that this procedure has consequences.
First, refinancing of the credit is followed, as a rule, by increase in its credit period. The borrower resorts to refinancing because of need to reduce monthly payments on the credit, thereby facilitating himself monthly payment, but increasing the financial burden generally. The fact is that lowering of monthly payments can be caused not so much by design of the new credit with a reduced annual interest rate, how many design of the new credit with the increased credit period, so, and saving of the borrower will be not such the considerable.
Secondly, refinancing of the credit will influence credit history of the borrower. In case of each address of the borrower with the request for receiving borrowing facilities the bank checks its credit history. Refinancing of the credit is the negative factor of credit history as it says to bank that the borrower does not cope with initial credit loading.
It is possible to refinance a car loan?
Car loans belong to the purpose-oriented loans issued on a specific purpose – acquisition of the car. In case of design of such credit the car becomes the mortgage property of bank before complete cancellation of a loan therefore it is difficult to renew it. If the borrower reads that financial loading in case of payment of a car loan to them could be reduced and also wants to extinguish completely it and to save the property from overloading, there are question candidate solutions.
for this purpose needs to issue one more consumer non-purpose loan (without specifying of a specific purpose of the credit) or to issue the credit for the relative (friend). In case of design of a consumer loan in other bank, the borrower will need to collect a complete document package on the new credit, having specified existence of an operating car loan (the credit institution all the same learns about it therefore to hide it there is no sense). If the income of the borrower allows it to issue one more credit, and on an operating car loan violations were not allowed (delay of payment and other), then the bank will meet requirements of him and will satisfy the request for receiving borrowing facilities.
In case of design of a consumer loan for the relative or other person for the purpose of refinancing of an operating car loan, it is necessary to understand the responsibility. Though the credit will also be issued on other person, the owner of a car loan should repay it. Therefore it is necessary to calculate the solvency not to spoil to other person credit history and not to threaten personal relations with him.