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Since 2016 Finance OR, your broker in the repurchase of credit for the owner on a human scale: under conditions and for the owner and the owner of the property, now offers you restructuring loans over 15 years and without taking mortgage guarantee for this repurchase.

The consolidation of your consumer credits over a long period of 15 years is now possible in 2019 with almost all of our banking partners. Explanations.

Borrowers concerned by the repurchase of consumer credits over 15 years?

Specific, the restructuring loan over 15 years (180 months) without a mortgage guarantee is intended for specific profiles of borrowers. You are one of those who can benefit from this advantageous solution if:

• You have renegotiated your mortgage at a very low rate and you no longer want to touch it;
• You are an owner and you wish to acquire another property but the reimbursement of your consumer loans is too high;
• Or you have a comfortable income and wish to buy back credits with the provision of cash;
• Or you don’t want a mortgage guarantee, but a 12-year (144 months) restructuring loan would impose too high monthly payments on you;
• Or you are retired and want the lowest possible monthly payments to fully enjoy retirement.

In all cases, this very advantageous type of loan buy-back is reserved for owners or first-time buyers.

To know: compared to a loan over 12 years, the loan over 15 years without a mortgage guarantee represents more than a 20% reduction on the monthly payments!

Conditions for grouping loans over 15 years

Here are the conditions required to be able to benefit from the purchase of consumer credits over 15 years without guarantee:

• Minimum loan amount: $ 22,000;
• Maximum loan amount: $ 200,000;
• Maximum age at the end of the loan: 85 years.

In addition, if a home loan is also included in the consolidation, it must be less than 60% of the total amount of the restructuring loan.

If you match the above profiles and your project meets the conditions, make your credit buyback simulation: it’s free and without obligation!

The advantages of grouping loans over 15 years or 180 months

Compared to a restructuring carried out over a shorter period, the repurchase of credits over 15 years will allow borrowers to repay lower monthly payments. This is the counterpart of the extension of the repayment period. In doing so, borrowers increase their living allowance (that is, the amount available after paying the monthly payments). Therefore, it is possible to have projects like:

• Finance the purchase of a car
• Give yourself a vacation
• Finance works
• Fund children’s studies
• Helping one or more parents in a retirement home
• Buy a second home or rental property

Example of credit repurchase over a period of 5 years to 15 years

The longer the duration of your credit repurchase, the lower the monthly payment. Conversely, the shorter the duration of the loan buy-back, the higher the amount of the monthly payment.
For example, for a grouping of loans of $ 75,000, with a linear interest rate of 3.5%, the monthly payments will be as follows (calculated excluding insurance):

Over a short period of 5 years, the monthly payment is higher and will, therefore, be $ 1,360.
Over a period of 7 years, reimbursement is $ 1,005.
Over a period of 10 years, the monthly payments are $ 739.
Over a period of 12 years, the monthly repayment of the loan is $ 637.
Over a long period of 15 years, the monthly payment is lower and it will be $ 535.

 

The repurchase of credit is the solution which makes it possible for any borrower to decrease the total amount of his monthly repayments of credits. This operation has the possibility of grouping all your credits or only a part, to make only one loan. The minimum loan amount and the maximum amount are capped on loan redemptions.

Depending on the type of credit, the loan amount does not have the same criteria at the level of the thresholds of the ceilings. If we are talking about revolving credit, personal loan, restricted credit or home loan the ceilings vary, the lowest thresholds as the highest loan amounts are very different.

What are the minimum amounts of all loans in 2020

For a credit consolidation, the total amount of the loan will be defined according to the type of operation and the profile of the borrower. The loan amounts are very often more substantial than for a so-called classic loan because we take back several credits and therefore the total amount is higher.

Each bank and each financial institution has its own criteria to define the minimum amount of loans. We will see the minimum and maximum amount for all types of loans.
Revolving credit is the credit that has the smallest loan amount. It often starts from $ 200 and initially stops at $ 21,500, but since the credit is refillable, it can go much higher.

For personal consumer loans, the minimum amount is $ 500 and the maximum loan amount is capped at $ 75,000. The repayment term for a personal loan is more than 3 months and often stops at 84 months or 7 years.
For mortgage, it is preferable to have a mortgage loan amount greater than $ 50,000 because the notary or surety fees are high.

What is the minimum borrowing amount to have to buy a loan repurchase?

Our financial lenders intervene from a certain amount of money when they grant a loan consolidation to a borrower. This commercial operation must be profitable for both the lender and the applicant.
There are 4 different types of offers:

• The mini loan buyout
• The purchase of consumer loans
• The redemption of consumer loans with mortgage guarantee
• The repurchase of mortgage

Let’s start with the mini loan buy-back so named because the minimum loan amount is $ 5,000. This mini credit buy-back is very restrictive. It takes at least 2 credits or credit and a bank overdraft, no rejection or unpaid with a repayment period between 1 year and 8 years must 96 months maximum.

This mini buy-back is very often carried out with its bank or with a financial organization better known for making revolving credits and which make credits on short durations or repurchases of consumer loans on small amounts.
A little reminder: Given that account statements are required without a bank incident, it will be very rare that we can do this kind of file.

The redemption of a consumer loan begins with the minimum amount of $ 7,650 in debt. But it is not because the threshold of the amount is reached that we will intervene. It takes at least a total of loan and cash of $ 20,000 for your broker Good Finance to offer you the study of your file.

Whether you are a tenant borrower or an owner borrower the minimum amount is the same for all borrowers. The maximum duration is 15 years or 180 months for owner borrowers, on the other hand for tenant borrowers the maximum duration is 144 months or 12 years.

The repurchase of consumer loans with a mortgage guarantee

The repurchase of consumer loans with a mortgage guarantee concerns only the borrower owner because it is necessary to own a real estate in order to be able to put it as collateral. If we offer a guarantee to the lender, this limits his risk and he can lend a much larger sum of money than buying back consumer loans without guarantee.

If your file is very tense because the total sum of the loans is very high or the amount of your monthly payments is important it is better to offer a property to mortgage in order to obtain its repurchase more easily. The minimum credit amount for the repurchase of credit starts at $ 22,000.

Borrowing interest rates are currently very low in 2020, it happens that even a good quality dossier is refused because of the usurious rate. In order to overcome this drawback, it is preferable to include a substantial amount of cash over a very long period. It is always possible thereafter to reduce the duration of the repurchase on condition of respecting the debt ratio and the amount of the remainder to live defined by the lender. The maximum duration of the credit is 35 years or 420 months.

 

Save on the monthly charge of your credit(s)

Compare loans and calculate what you can save on your monthly payment. You often get rid of your loan faster or your monthly burden decreases by transferring your loan.

How can you transfer a loan?

Compare loans to see if you can get a lower interest rate or a lower monthly charge. If that is the case, you can immediately apply for one or more loans via loan provider. These are quotations that you are not yet committed to.

You will receive the quotation (s) for the credit online by email or by post. You will return the signed agreement from the lender of your choice. Many lenders will repay your existing loan and deposit any amount that remains in your account. If the lender does not repay the loan for you, the entire amount will be deposited into your account and you can, therefore, repay your existing loan yourself.

Can you transfer all loans?

You can transfer any form of a loan, revolving credit or personal loan, but also an outstanding debt on a credit card or overdraft on your payment account to a cheaper loan. For a credit card, overdraft and revolving credit, these can always be repaid fine-free (without costs).

A personal loan cannot always be repaid without penalty. This differs per lender. If a lender charge costs for transferring your existing loan, this is stated in your loan agreement. You can also find this in our comparison. Then choose a personal loan and stand with your mouse on the info button with your current lender. You will then see whether penalty-free repayments are possible.

If a lender does charge costs, it is good to know that this may not exceed 1% of the amount to be repaid. So if you pay off 10,000 USD, the maximum fine is 100 USD. You usually earn these costs back within a few months, because you get a lower interest rate when you take out the loan.

Loan acceptance

Of course, the new lender will first check whether you are eligible for a new loan. They do this by looking at your income and expenses. But we also look at your marital status, payment history of your current credits (Bureau Credit Registration) and whether you have children, for example.

If you only want to transfer the current loan and do not borrow an extra amount, chances are that you will be accepted. Most lenders have roughly the same acceptance criteria. You can also calculate your maximum loan on the loan providers.

You plan to take out a credit or a loan: whether it is an installment loan or a mortgage loan.

You are a little worried because like everyone else, you do not know what the future holds and you would like to be sure that you can repay your credit until maturity.

Did you know that you can match your loan with insurance, the premium of which is modest and which can keep you from financial risks during the entire life of your credit?

A few words of explanation …

 

Why take out insurance?

Without wishing to play on the economic situation that strikes Europe or Belgium, it is clear that lately, there has not been a week without the media announcing a corporate restructuring, synonymous with job losses. Unfortunately, this can happen to anyone.

Sometimes you also borrow with your spouse or a third person and an unexpected death puts your repayment capacity in serious jeopardy.

The consequences of default and termination can be particularly stigmatizing.

 

What types of insurance policy?

Rest assured, you are not without resources to overcome these kinds of difficulties. The types of insurance that may be useful to you are generally of two types: job loss insurance and balance due insurance.

 

What conditions?

Loss of employment insurance

• Be at least 21 years old;
• Waiting period of 6 months after taking out the credit agreement;
• Being in the bonds of an open-ended contract;
• Have completed your trial period of one month 3 months;
• To be able to claim unemployment benefits.

Balance outstanding insurance

You must answer a questionnaire that will allow your insurer to measure the risks inherent in your file. Sometimes, too, you have to undergo a medical examination.

This insurance protects your heirs and your co-borrower in the event of death.

Optional or mandatory?

The conclusion of an insurance contract is always optional. However, some banks will refuse to grant you credit if you do not purchase a balance outstanding insurance policy. In this case, you give up your credit.

Sleep easy

The cost of these insurances is not high. Talk to your broker about the premium amount. In general, this premium is paid at once and its amount is deducted from the amount of credit granted to you.

Tranquility obviously has a cost, but nothing beats tranquility.

 

Tax consequences of borrowing money

Taking out a loan is a financial transaction that can have tax consequences. This is not always the case, but it is possible. The possible tax consequences are:

• Less load in box 3
• 2. deductible interest in box 1

1. Less tax in box 3

In principle, a consumer credit such as a personal loan or a revolving credit falls in box 3, which is the tax box in which tax is levied on capital. Now a loan is not a possession, it is a debt. A loan, therefore, lowers your capital in box 3, with the effect that you pay less tax on your capital.

This does not have consequences for everyone. To pay less tax in box 3 you first have to pay tax. After all, less than zero is not possible. You only pay tax in box 3 (capital gains tax) if you have more capital in 2020 than the exempt amount of $ 30,846 per person ($ 30,360 in 2019). This only applies to partners with assets of more than $ 60,000. If the total value of your savings, investments, etc. is less than that, then you already pay no tax in box 3.

If you are above the exemption, a loan can, therefore, reduce the tax payable. The loan must, however, exceed the debt threshold. That threshold is to prevent any overdraft on a payment account from causing tax hassle.

2. Deductible interest in box 1

In some situations, the interest you pay on a loan is tax-deductible through the mortgage interest deduction. This is only possible if the loan meets certain conditions. The first condition is that the borrowed money is spent on the purchase, maintenance or improvement of an owner-occupied home. For example, a loan for a renovation. Or for a new kitchen. Or for a dormer. For these spending goals, the loan falls under the home acquisition debt, which does not require that it be a mortgage.

The second condition for mortgage interest deduction is that the loan is repaid at least annually in a maximum of 30 years, according to a set schedule. A revolving credit does not meet that condition. A personal loan does.

So if you have taken out a personal loan for renovating your own home, the interest on that loan is tax-deductible. The loan then falls in box 1 instead of inbox 3.

If you are going to renovate and want to borrow money for it, it is wise to find out what is cheaper: increase the mortgage or take out a personal loan. All kinds of costs are involved in increasing a mortgage. These are not an issue when taking out a personal loan. However, the interest on a personal loan is higher than on a mortgage. Which choice is better in your situation? For this, you have to compare the cost advantage of the personal loan with the interest benefit of the mortgage.

The beautiful days are here and with them certainly the desire to renovate and do work in your home. Take the opportunity to bring more comfort to your whole family. Why not install a veranda in your garden, or transform your garden? The layout of your attic to add a more peaceful living space in your home. Change the frames or place double glazing to save on your fuel oil consumption bill.

 

Who can make a work loan?

Only the owners can make a work loan. A tenant cannot take out a loan under the preferential conditions of the works loan. He will have to take out a classic installment loan.

What are the conditions for making a work loan?

• Being the owner of his home;
• Provide the quote signed by both parties (the contractor and the owner);
• In the absence of an estimate, provide the invoice for the work;
• The estimate must cover at least 80% of the amount of the sums borrowed;
• ID card ;
• Last three pay slips;
• Bank extracts to which the salary is paid;
• Title of the house;
• Loan with two names for married people.

Is there a maximum borrowing limit?

No, everything will depend on your ability to contribute.

 

Installment loan or mortgage loan?

When it comes to works loans, this is an important question that is often asked to us: what is the most interesting formula: installment loan or mortgage credit?

In general, the installment loan will be the winning formula. Indeed, mortgage credit does however incur costs and even if the rates are lower in mortgage credit (3.5%), the costs incurred by mortgage credit will lose this advantage. The rates on installment loan are around 7%, so it is only if you plan to borrow a very high amount (more than 50,000 dollars) that the mortgage will become attractive.

The mortgage loan will be the solution for the candidate borrower who cannot offer other sufficient guarantees (for example if the amount of the salary is too low or if there are already other loans in progress).

Are mortgage loan fees important?

When purchasing your home, the financial institution will provide a mortgage guarantee. This guarantee will entail costs of four orders: costs of borrowing deeds, notarial costs, registration fee for registration administration and VAT.

When your initial mortgage loan is already well repaid, you can take out a mortgage loan again to carry out work. In this case, the costs will be lower. They will no longer be of two types: borrowing deed costs and notarial fees.

So, to know exactly which of the two formulas is the most interesting for you, you will have to ask one of our brokers to analyze your file. Let’s say that below 25,000 dollars and unless you really have no other solution, you will have to please the installment loan.

And do not forget….

At a rate when raw materials are running out and given the frenetic increase in energy prices, doing insulation work for example means reducing your energy bills. The same goes when you buy a refrigerator or a dishwasher of the upper range which will consume significantly less electricity. Ultimately, you will be a winner and participate in the ecological effort.

The repurchase of mortgage means a renegotiation of the rate with your bank or with all the other banks or financial organizations. Indeed, for a few years rates have been falling sharply and in January 2020 mortgage rates have never been so low.

The rate proposed for a mortgage varies according to the quality of your file, the duration, the financial contribution as well as the commercial stake. The renegotiation of your mortgage has the advantages of reducing the monthly payment or reducing the duration of your mortgage.

What is a renegotiation or a repurchase of a mortgage?

A mortgage renegotiation implies that the borrower’s bank renegotiates the mortgage rate of his own client by making him a better proposal of borrowing rate for his mortgage.

A repurchase of mortgage is carried out with a bank which is not that of the borrower owner or the customer. So this competing bank will reimburse the mortgage with the borrower’s bank and it will make a loan offer with a more attractive rate.

What is the interest for the borrower to redeem his mortgage:

Buying a home loan means saving money in the long term. If a rate reduction of at least 0.5% is obtained.
Example with 0.5% less: You made a home loan of $ 200,000 in January 2017 over a period of 20 years (240 months) and at the rate of 3% and you repay a monthly payment of $ 1,106.43 per month excluding insurance.

In January 2020, a bank offers you to buy your home loan with a rate of 2.50% over an equivalent remaining term of 17 years (204 months). This will reimburse you a monthly payment of $ 1061.55 per month excluding insurance. A saving of $ 44.88 per month, or $ 9155.52 over a period of 17 years. The operation is profitable, but be careful not to forget to add the costs involved in a buyout of a mortgage. In the end, the gain is not as significant.

Example with 1% less:
We take the same amount of financing and the same duration, this brings the new maturity of the loan to $ 1020.42. This saves $ 86.01 per month, or $ 17,547.04 over 17 years (204 months). Remember to subtract the fees from the total credit gain.

Good Finance recommends at least one point difference and provided that you are on the first half of your real estate reimbursement.

What are the inseparable costs for buying back home loans?

• First of all, if you don’t renegotiate your home loans with your bank, there are early repayment indemnity (IRA) fees that are equivalent to the last 6 months of interest with a maximum ceiling of 3% of the principal repaid. The least costly amount for the borrower will be retained. This amount is owed to the bank you are leaving. If you renegotiate with your bank, it will often give you a gift, but it will improve its interest rate, nothing is free.
• The costs of handling the new bank are to be taken into account. They are however negotiable with the bank.
• The bank will not lend you without collateral except for a very short time. The new mortgage involves mortgage costs or bond costs ( surety company affiliated with the bank). In the case of redemption we no longer speak of IPPD registration of privilege of lenders of money as, during an acquisition, this is called a mortgage.

Insurance:
Loan insurance is to be negotiated with the bank which will take back your credit and will automatically offer group insurance, or else with an insurance broker like your loan repurchase broker for senior Good Finance who will offer you individual and often insurance much cheaper than group insurance. Individual insurance is calculated according to your age, the loan amount, the interest rate and the duration of the new loan repurchase.

Consequences for the bank to renegotiate its own mortgage

When the bank renegotiates the mortgage loan of its client it loses money, because taking back its own debt at a lower rate is financially unsuccessful. This is why banks are very reluctant to take on their own debt and they often drag on for several months in order to discourage their customers.

On the other hand, if the bank renegotiates the mortgage loan of its client, it keeps commercial contact with its client therefore and it keeps loan insurance and other insurance such as home insurance, car insurance, and investments as well as all derivative products (funeral guarantee, telephone, alarm, etc.). Banks no longer earn money on a mortgage, but on all banking products or derivatives. This renegotiation operation will be a win for both parties.

You then have a statutory reflection period of 11 days if your loan offer is subject to articles L312-1; the loan offer is valid for 30 days from the date of receipt. The customer cannot retract after having returned the acceptance to the Lender.
If your loan offer is subject to articles L311-1 you have a withdrawal period of 14 days from acceptance of the offer. The loan offer is valid for 30 days from the date of publication.

As soon as our partner receives your acceptance, your creditors are reimbursed immediately and any cash you have requested is paid to you. The following month, without having to change anything, your new monthly payment will be debited directly from your account.

The different stages of a loan buyback file

The constitution of a credit consolidation operation takes place in several stages, starting with finding the right broker specialized in loan consolidation, then the simulation, the analysis of the file and the issuance of a loan offer, ending with the credit financing.

Find the broker specializing in loan repurchase

The broker is the intermediary in banking operations who has the mission his client therefore the borrower finds a solution by grouping credits with lending partners. You consult your bank or a loan consolidation broker. This request for loan consolidation can be made to your bank adviser, but beware you certainly have a liability in your bank that does not necessarily work in your favor or you do not fit into the criteria of banks: such as duration or amount credit or loan start and end ages.

Make a simulation

The purpose of the simulation is to save time for both parties, both the borrower and the loan repurchase broker. The easiest way is to contact a broker specializing in loan consolidation, either by phone or directly by the internet by filling out a form called the simulation. This simulation concerns your marital status, your income, the amount of your credits, your monthly payments and your home.

If you address several brokers directly on their site you will receive different proposals for credit consolidation. Comparing the proposals well is a very important step which will allow you to make your choice in all transparency and with the best conditions.

• The total amount of your loans to take back.
• The amount of the new project or cash included in the amount of your financing.
• The interest rate on the loan repurchase.
• The repayment duration of the redemption.
• The new monthly payment for your credit union.
• The insurance prices must be indicated on the loan consolidation proposal.

After comparing the different proposals, ask the right questions to the loan consolidation broker:

• Cash and all fees are included in the total amount of your buy-back, so monthly payments include cash and fees. Or is the monthly payment calculated excluding cash or fees?
• Is the insurance coverage 50% on each head or 100% for the borrower and 100% for the co-borrower? Insurance pricing, in the end, is double to double.

When you have had all the answers to your questions, you will be able to choose the credit repurchase broker to whom you will send your file.

Warning: if you do not want to be invaded by phone calls and emails, avoid filling out forms on comparison sites, because your file is automatically sold to a dozen brokers who will harass you in order to retrieve your file without having does a very thorough analysis. You will, therefore, receive a very attractive but erroneous proposal.

Analysis of your loan buyback file

Upon receipt of your simulation, an analyst studies your request. He will check your repayment capacity: your new monthly payment must respect a maximum debt ratio of 45% compared to your income. Your living space must be at least 900th for a couple without children.

The repayment period must be adapted to your situation. If the credit consolidation transaction is favorable, the borrower must provide the list of documents requested. If the redemption of your credits proves impossible, the refusal will be given to you immediately, without asking for your documents.

The assembly and the feasibility of your file

On receipt of all your documents, the same analyst takes the personal information that you transmitted during your redemption simulation and verifies it with your documents. Your file complies with the criteria of our partner that we have selected in order to get you the best rate and the most suitable duration for this credit consolidation operation. Your file is sent to our partner for the edition of a loan offer.

Issuance of the loan offer

The borrower receives his loan consolidation offer in general by mail or online. These are very well detailed. First, there is the user manual to complete your file and the reflection period for the acceptance of your credit offer. The customer information sheet contains all the information that your loan repurchase broker transmitted to his lender and that you gave him during your simulation.

All your credits are noted one by one, whether or not they are included in the loan group. The credit summary is detailed for each amount concerning the amount of credits to be grouped, the amount of costs and amount of cash for new projects or works. The future debt ratio after the credit consolidation operation and the residual are recalculated.

Then comes the European standardized information sheet which contains all the characteristics of credit. Finally, the loan consolidation contract offer which summarizes all the information: the total amount of the credit, the duration, the monthly payments, the borrowing rate, the annual effective annual rate (APR), the total cost of the credit and the total amount due. by the borrower.

It is specified if he has a mortgage and the contact details of the notary. Optional loan insurance coverage is specified. The general conditions indicate the penalties in the event of early repayment The borrower must comply with a mandatory cooling-off period before returning his credit offer.

The reflection period for a grouping of consumer loans is 14 days and 10 days for the repurchase of home loans. The borrower only has to initial and sign and send by mail his loan offer directly to the lender.