A solution not always known to borrowers, buying back credit allows you to group different invoices, but above all also to reduce your monthly repayment. Under what conditions can you get a loan buy-back, and how do you go about reducing your monthly payments as much as possible? Explanations
What is credit repurchase?
Credit repurchase (or credit consolidation) consists of replacing one or more existing commitments with a single credit. You combine all your commitments into a single renegotiated loan more advantageously. With a credit buy-back, it is possible to combine:
- Your personal credits: regardless of the establishment from which you borrowed the money or the amount to be redeemed.
- Your leasings: car, motorcycle,…
- Your credit card invoices: especially if you cannot pay the balance and plan to pay off a credit card in several monthly installments.
Once the purchase is made, you not only combine several invoices into a single monthly payment, but also save on your monthly payments. Indeed, the single monthly payment is often much cheaper than the sum of your commitments thus grouped. We consider that it is possible to save up to 40% on your monthly payments with a grouping of credits.
What conditions to obtain a buyout?
From a practical point of view, a repurchase of credit is considered in the same way as a credit. Indeed, a credit repurchase is nothing other than a credit whose amount allows you to repay all your commitments. It is also possible to request, in addition to the redemption, an additional credit. Thus, the conditions of a credit buy-back are identical to those of a personal loan, namely:
- Have a regular and sufficient income to cover the reimbursement of the new monthly payment.
- Have no lawsuits or financial history (ZEK codes, etc.).
- Be Swiss or have a permit (B, C, G, or legitimation card).
- Be over 18, and under 65.
A concrete example
Mr Dubois wishes to use a credit buyout to combine two commitments:
- A loan with a rate of 11.9%, for which he pays a monthly payment of 1,079 USD. He still has around 10,000 USD to reimburse in one year.
- A credit card with a balance to be reimbursed of 3,000 USD. If he chooses to repay in several monthly payments, the credit card organization applies an interest rate of 14.9% on the unpaid.
With a repurchase of credit, Mr. Dubois combines his credit and the negative balance of his credit card. He therefore buys a total of 13,000 USD, and chooses to repay this amount over two years. He manages to obtain a rate of 7.9% on this new credit, and will therefore reimburse monthly payments of only 585 USD !
Who to contact?
As with a personal loan, the best solution is to contact an experienced agency or broker. Indeed, it is important to call on a qualified contact so that the redemption is carried out correctly, and especially in order to benefit from a more advantageous rate! Best Bank thus offers advantageous credit repurchase solutions, where your commitments are automatically grouped without you having to manage them!