Credit repayment: how to save money on your loan?
Many people make personal loans in Switzerland (more than 400’000 contracts in 2014), but credit repurchase is a less common financial solution. However, borrowers could benefit a lot more from this convenient and advantageous alternative. What is debt consolidation and how much can you save thanks to this solution? Let’s have a closer look:
What is credit repayment?A credit consolidation, also called debt repurchase, simply means that you can regroup several financial commitments together:
- Personal loans: a credit repurchase then stands for a replacement of your ongoing credit with another credit that has better conditions and is offered by another society.
- Credit card consolidation: it is possible to reimburse your credit cards debts by borrowing some money. This solution might seem useless (borrowing in order to reimburse a loan), but you should know that personal loans usually have lower interest rates than what you pay for your credit cards debts.
- Leasings: credit repurchase can also apply to leasing solutions.
How much can you save?People are mostly interested to know how much they can save when regrouping their financial commitments. This will depend on:
- The commitments you wish to regroup and the actual conditions of these commitments (interest rate,…).
- The repurchase conditions: duration and interest rate offered.
Other advantages?You should also consider the other benefits of a credit repurchase.
- Simplify your billing, by replacing many monthly payments by one only.
- Re-organise your budget by defining the reimbursement duration for example. You can then budget clearly and safely your loan reimbursement.