Are you looking for a loan to pay off debt? Debt rescheduling loans have the potential to save interest and increase liquidity.
The personal requirements of the debtor willing to reschedule decide whether and at what interest rate the loan is granted. By choosing the right loan offer, inconvenience can be avoided.
In our debt rescheduling guide, you can find out what is important for the debt rescheduling to succeed.
Repay credit to debt – reschedule expensive loans
Low-interest loan to pay off debts is an installment loan. Short-term loans in particular should be the focus of debt restructuring. The overdraft facility, which is used all too often, is everything else in terms of financing costs, but not at low interest rates. German Company checked overdraft rates in Germany about a year ago. The result was so frighteningly expensive that even politicians intervened and threatened compulsory regulation.
The inspectors of his time had discovered up to 17.5 percent dispo interest within the permitted discount range. Unfortunately, nothing has changed since then. In March 2016, a savings bank from the district of Paderborn / Lippe received a whopping 16.88 percent for the overdraft facility. Only credit card overdrafts are of the same order of magnitude.
Low-interest loan to pay off debts, overdraft is the most important approach. The disposition is comfortable, but only a temporary solution. To make the numbers a little more transparent, almost 17 percent interest seems expensive, but still meaningless, an example.
Debt overdraft for installment loan – savings example
Statistically speaking, the people who overdraw their accounts have an average debt of around 3,000 USD in their checking accounts. They pay – as the present account statement shows – about 16.88 percent APR. In the year it would be 506.40 USD interest or 42.20 USD per month. An impressive sum, but those who borrow money have to pay. – He shouldn’t just be exploited.
A classic loan to pay off debts on this scale is a small loan. If the $ 3,000 debit debt were financed by a good loan comparison calculator with a term of 36 months, the bank charged 1.99 percent effective interest. The interest rate mentioned is independent of creditworthiness. Every applicant who is fundamentally qualified to grant the loan receives this interest.
Almost 15 percent interest rate differential looks impressive, the savings effect in USD is even more impressive. The financing costs per year for the installment loan are lower than for the overdraft facility per month. The bank earns interest of only USD 30.69 on the installment loan all year round or USD 2.55 per month.
Those who do not reschedule their overdraft facility in view of these figures seem to earn their money in their sleep. There is no other reason for this decision.
Debt restructuring – regaining liquidity
Medial Germany and family reality do not have much in common. The Best Bank is fighting “deflation”, of which there is no trace in the family’s household budget. The government presents Germany as a rich country everywhere. It is not easy to make ends meet. Inexpensive living space has been renovated into expensive luxury apartments where job opportunities create income opportunities.
The average family is also not free of debt. Favorable key interest rates relieve the household budget without question. However, in view of the rising real cost of living, the household allowance in families with children is enough to make ends meet. Anyone can only be advised to reschedule current credit obligations and overdraft facilities every few years.
By combining the remaining debt in a new loan, together with a changed term, liquidity can be regained. Nevertheless, any debt restructuring should be done carefully. Loans for which credit insurance protection exists are unsuitable for debt rescheduling. Quite horrendous insurance costs were paid for the residual debt insurance. A back calculation or transfer to the loan to repay debt is not possible.
Debt rescheduling loan – Find providers via the loan comparison
With average or normal credit ratings, debt rescheduling in Germany has become significantly cheaper in recent years. The easiest way to find the right loan offer is to compare the loan. As already mentioned, small loan amounts can currently be financed at an effective annual interest rate of 1.99 percent. Medium-sized debt rescheduling loans are also not much more expensive.
For example, a debt rescheduling loan of USD 15,000 would be required. The financing is to run for 60, 72 or 84 months, starting with interest rate offers that are independent of creditworthiness with 3.89 percent effective interest. Three providers currently offer financing under 4.0 percent effective interest rate “for everyone”.
Repay credit to debt – problem solving
Debt is particularly common for people who feel overwhelmed by their current debt burden. Unfortunately, personal creditworthiness for lending has often suffered in these cases. With a low score, a loan to pay off debts could come from more risk-taking credit institutions.
In contrast to regular loans, these credit providers check by hand. This opens up the possibility of invalidating bad credit information by means of evidence. Another alternative would be a private debt rescheduling loan.
When it comes to private lending, the reputable environment for initiating and processing credit is important. We recommend the loan application via Smava for the loan to pay off debt via private lenders.