The repurchase of credit can concern the mortgage, but also the consumer credits. When a borrower accumulates several credits and wants to reduce his monthly payments or finance new projects he can request a repurchase of credit. A lending agency then collects all the credits in one by re-determining the rate, the monthly payments and the duration of the loan.
Redemption of Credit: APR
When talking about the rate of a loan, it’s not just about looking at the interest rate on the amount borrowed. It is also necessary to take into account the ancillary expenses and the expenses of file. At the time of the repurchase of its credit, the borrower must be interested in the Global Effective Annual Rate (APR) which takes into account all these parameters. This is the reference rate for evaluating the profitability of the credit surrender.
Redemption of Credit: Market News
Interest rates change and can vary greatly depending on the activity of the financial market. To determine its redemption rate, it is therefore necessary to keep abreast of current interest rates and benefit from a decline, if this is the case for example.
Redemption of Credit: Current Credits
The repurchase rate of credit finally depends on the credits concerned. It is necessary to take into account the interest rates of these credits and to ensure that the repurchase rate is lower than the previous ones. It is also important to look at the remaining duration of the credits. If the borrower has already repaid a large portion of his credit, he must negotiate a shorter credit surrender. For example, for a loan provided for 60 monthly installments of which 36 monthly payments have already been paid, the repurchase rate of credit is determined over a period of 24 months and more than 60 as at the outset. Interest rates can then be more interesting. The remaining duration can also be redefined and extended to allow lower monthly payments.