Credit consolidation is a restructuring operation of several credits. A smoothing of all the remaining amounts to have to make only one credit with a monthly payment adapted to the repayment capacity of the subscriber.
Grouping credit is recommended since we have not been vigilant enough about the number of credits to repay in the month. So, it is not very good to commit to a new credit knowing that 50% of your financial budget represents the amount of maturity of consumer loans being amortized.
As a result, it is advisable to consolidate consumer (and real estate) loans. The repurchase of loans allows the consolidation of credits accompanied by a repayment plan adapted to your budget. The loan aggregation organization has the obligation under the Consumer Code to send you a pre-contractual form. The pre-contractual form informs the consumer in detail about the characteristics of the proposed credit buy-back plan.
A prepayment of the outstanding principal of your loan consolidation, how does it work?
Credit consolidation: early repayment
You can proceed with the balance of the outstanding principal of your loan, so repaying an early redemption is a thing quite possible and feasible. It is a valid right to any person liable for a debt.
Then, it is possible to make a partial or total prepayment of the remaining capital due to a consolidation of credits. The repayment is made according to the particular and general conditions of the prior offer of credit in accordance with the law of consumer credit and real estate in force. According to the nature of said Romnick Centerment, ie to consumption or mortgage, the conditions are different.
Because you must know that pay a loan before the end date depreciation determined at the signing of the contract, entails early repayment benefits (IRA). Not collecting the full sum of the interest on the loan consolidation contract, the issuing bank has the right to demand compensation from the borrower.
Rest assured, the treatment of the operation is totally framed by the law.
Early repayment of a mortgage repurchase
The code of consumption provides for a penalty equal to the value of one half of interest and this within the limit of 3% of the capital remaining due, according to Article L three hundred and twelve-one of the Consumer Code.
However, it has already happened during the investigation of the repurchase of mortgage, to take note of a certificate of early repayment mentioning indemnities greater than three percent. How is this possible?
The nature of the loan to be redeemed is a mortgage restructuring transaction, the question about the credit consolidation and its is complex, which is for sure, it is that the offer stipulates well in the clause reserved for repayment by anticipation that the indemnity is calculated on the basis of the outstanding capital and the remaining repayment term.
Therefore, if the contract is signed by both parties and accepted, the clause applies contractually. In other words, it is a ratio between the amount remaining due by the debtor (s) and the end of credit period. The more recent the credit, the higher the IRA, this is a guarantee for the creditor to ensure maximum profitability on the banking product marketed.
Early repayment buyback of consumer credit
In the event of early repayment of a consumer loan buy-back (personal loan), the lending institution may claim compensation that may not exceed 1% of the outstanding capital to the extent that the sum to be owed is greater than 10K €.
The indemnity is capped at 0.5% if the remaining period of amortization is less than one year. No other compensation may be required by the lending institution. Although before the entry into force of the Lagarde Law in May 2011, the rate of this allowance was increased to 5% of the money remaining to be paid.
Is it possible to negotiate prepayment benefits?
Yes, it is possible, everything is negotiable every day! Trading is a business that requires a thorough knowledge of financial products.
Our status as a credit buyback broker gives us access to all of the pooled credit banking services in the market thanks to numerous partnerships with the leading banks specializing in loan buybacks.