A large number of households temporarily solve their acute needs in addition to consumer loans also in the form of credit cards, overdraft, etc. Repayments then grow over their heads, obligations are confusing and in their heads they only sound “jingles: debts, debts and debts”.

Appropriate help should be consolidation of loans.

Appropriate help should be consolidation of loans.

In most cases, bank and non-bank loan consolidation means an increase in the family budget, where by lowering the installments, the family can use the remaining money for other purposes. The advantage is also a significant clarification of all amounts owed to all creditors, which will thus merge into one. Some banks can also consolidate liabilities, provided that there is no mortgage. However, loans must be managed to repay until the date of application for consolidation; they must not be overdue or otherwise significantly impaired. In this case, the person gets into the register and is only allowed consolidation in the non-banking sector. That is, in a sector where registers are not examined. Here, however, everyone has to calculate that such a client is a more risky entity for non-banking companies. Especially for this reason,

The property may not be pledged in an amount greater than 50% of the market value of the property. It is this level that non-banking companies are generally able to provide finance. Almost none of them also accepts its second rank. It is therefore primarily necessary that the creditor, who is already on the property sheet and is already pledging, be paid. Beyond the level of this lien (under the constant assumption of “up to 50% of market estimate”), non-banking companies are able to satisfy other creditors who are part of the loan consolidation application.

Loan interest rate

Loan interest rate

In addition to clarifying liabilities, other factors that affect the main reasons for applying for consolidation of loans are primarily the annual interest rate, but also the maturity. It is important to look for such creditors, whether in the form of banking or non-banking companies, who are able to lower the interest rate, but rather the APR (= all costs associated with the loan). Indeed, an increase in maturity alone, assuming the same interest rate, means that although the monthly installment will decrease, the applicant will also pay more money to the banking or non-banking companies as a whole. This means that they will overpay more than the combined liabilities – making the consolidation loan more expensive.

Interest in the consolidation of loans hand in hand with higher indebtedness of households continues to grow. However, different constraints on such consolidation have to be envisaged for banking companies. Some banking companies do not allow consolidation of loans without creating a mortgage, as is the case with non-banking companies.

Documents needed

Documents needed

Be aware of the fact that you will have to present two IDs to your bank, a copy of your bank statement, receipts, documentation of the loans you would like to consolidate, and so on.

In order to consolidate with us, ie without the need to examine the registers, we require you to fill in a specific form with several details and a photograph of the property for which a lien will be created in case of consolidation. That is all.

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