Because the world of credit is sometimes opaque, financial company explains the differences between certain transactions.
Credit repurchase, loan consolidation, renegotiation… If the names are similar, the operations differ.
Restructuring, repurchase of mortgage, grouping of loans: how does it work?
Did you think that the repurchase of credit only concerned real estate or was the same operation as a renegotiation of a mortgage? These operations are quite separate, if you confuse them, this article is for you.
Debt restructuring has several names: repurchase of credit, refinancing, consolidation of credit… This operation consists in redeeming its current credits (consumer credit, work loan, auto loan, revolving loan, or real estate loan,…). The goal is to reduce the monthly payments and the borrower’s debt ratio. The rate is unique and it only pays one monthly payment. This operation is often equated with the repurchase of mortgage, wrongly.
The repurchase of mortgage
The two solutions should not be confused since, in the case of the repurchase of mortgage, it is a question of having it repurchased by another bank in order to benefit from a more advantageous rate. This helps to reduce the loan term or the monthly payments. The borrower will, therefore, take out a new mortgage.
The renegotiation of mortgage loan induces another nuance. The borrower will renegotiate the current mortgage rate with his current bank. The bank is not obliged to grant him a rate cut, it is a negotiation. It is possible that the latter, if it accepts, will invoice bank charges.
Carry out credit buyback simulations
With financial company, you can carry out credit repurchase simulations online in order to take stock of the interest, for you, of this operation. Our credit repurchase calculator allows you to discover the possible monthly decrease after a grouping of credits.
You can also simulate your debt ratio or calculate your outstanding capital to know the share of all your credits in your budget as well as the amount that you have to repay.
Take advantage of our expertise in credit consolidation, it’s without obligation!