A loan that you took two years ago may be available today at a cheaper rate . Why is that? Interest rates are constantly changing and can change from year to year. If you do not want to pay too much, cancel the loan . If the loan was taken after June 11, 2010, a loan can be canceled at any time and you can combine the existing loans and replace them with a cheaper one. However, debt restructuring may be costly.
In June 2010, the Consumer Credit Directives entered into force in the European Union. They allow borrowers to terminate their loan at any time. The drawback: The banks have the option to charge a prepayment penalty – this is limited to 1.0 percent of the remaining loan amount, with remaining maturities of less than a year, the maximum rate is 0.5 percent. The credit institutions may charge the fee because they suffer interest losses due to the early termination. Therefore, if you are planning a rescheduling , you should allow for such costs. For the purpose of a loan termination and a subsequent debt restructuring should be to save costs. However, if the early repayment fee exceeds the savings, this step is not financially viable.
If you want to terminate a loan, you should first take care of a debt rescheduling loan, so that you can repay the outstanding debt in due time to the bank . Use our comparison calculator for this purpose – at the same time you secure a favorable interest rate and increase your savings significantly. Enter in the bank of your choice absolutely the use of – this will come back to your old Institute in touch and take care of the credit repayment. Collateral that has been deposited for the old loan, the old bank also has a so-called trust order to the replacing bank.
The benefits of a loan cancellation are obvious: The low interest rate you lower your costs. Adding multiple credits also improves your credit rating because you only need to serve one creditor and the monthly installment is better suited to your personal financial condition. This minimizes the risk of default.