Seize the right moment to carry out a repurchase operation of credit, whether it is to profit from a better rate or to durably reduce the monthly payments.
Why buy a loan?
A loan repurchase transaction can allow a borrower to readjust their repayment conditions according to the new loan conditions. If a significant drop in rates has taken place between the subscription date and the current date, then it may be worthwhile to consider a credit repurchase transaction. The idea of this financing is to apply to a competing bank to ask it to buy back its mortgage. The current rate must be attractive enough to absorb the costs associated with early repayment, the interest of the loan buy-back will be justified on the savings made, but this is not the only interest.
Some borrowers will consider buying back loans to reduce the amount of monthly loans, to respond to an event (unforeseen financial, change of situation, professional development, etc.) or simply to avoid the accumulation of several loans. The idea in this operation is to make a request for credit consolidation at the right time, that is to say when the situation still allows to obtain financing. In the event of an imbalance in the household’s finances, recourse to this banking operation may not be successful. It is therefore necessary to request the repurchase of credit at the right time.
Credit repurchase: when to start?
In the context of a credit buy-back operation involving only a mortgage, there must be at least one point difference between the initial rate and the new rate offered. This difference is enough to make the transaction financially attractive, with savings on interest. There is therefore no time limit between the subscription of the mortgage and the repurchase of the credit, it can happen a few months as several years. You should know that this operation is interesting when it is carried out in the first years of repayment, because they are essentially dedicated to the repayment of interest.
If the borrower wishes to reduce his monthly payments by grouping several loans into one, it is necessary to enter the right moment according to his situation. Losing a job, falling income, or simply filing a bank can lead to inability to obtain financing. It is therefore necessary to be aware of the situation, of the credits in progress and to request the grouping of loans to restore the balance within finances. It is worth noting that one can also apply for this loan to finance a new project, even with credits already in progress.
Simulate a loan buyout online
The credit buyout simulation remains the most relevant step to define if a bank transaction to buy back outstanding is interesting, and above all comes at the right time. The simulator will make it possible to provide estimated data to the borrower and to inform him of the new repayment conditions that may be offered to him. By comparing the loan conditions and the total cost of the two financings, it is possible to determine whether the timing is ideal or not.