The credit repurchase is a personal credit which allows you to group together several of your current credits. It is also called “credit consolidation”, “refinancing” or “debt consolidation”.
The repurchase of credit is often proposed by financial organizations to settle all your outstanding loans and to offer you a single loan. So you go from several credits with several rates and several repayment periods, to a single credit with a single fixed interest rate and a single repayment period.
Does the repurchase of credit have a cost?
Even if we don’t show it to you directly, yes, buying back credit has a cost. This cost corresponds to the commission which will be invoiced to you by your broker. She pays for the consultancy work he brought you to find the best solution to your situation.
Since you are already in debt with repayment difficulties, you will generally not be asked to pay directly. This commission will be included in your new single loan.
Are there several forms of credit repurchase?
The purchase of consumer credit allows you to combine all your consumer credits into one credit. These consumer credits can be of all types. Loyalty cards with a credit that you have taken out in store, personal loans such as new car credits or used car credits, motorcycle credits, work credits, energy credits, holidays, studies, etc. ), but also the tax debts you owe to the state.
At the end of the redemption of all these credits, you will have only one credit which will be assimilated to a consumer credit.
Generally the new amount varies between 5,000 dollars and 75,000 dollars and the loan duration varies between 12 months (1 year) and 120 months (10 years).
If you wish, you can add your mortgage to this loan repurchase. This reassures the banks especially if your property is used as collateral.
In the same way as for the grouping of consumer loans, you will only have one loan from the consolidation of your home loan and your consumer loans.
How to combine credits?
You can request the completion of your credit repurchase either to a broker or to a bank agency. In the latter case, the agency will often advise you to use a broker with whom it is used to working.
The broker will ask you to take stock of all the outstanding credits that you have, and will ask you for various administrative documents. On this basis, he will study what would be the best possible repayment scheme.
At the end of this study, your broker will offer you a credit offer and you will be able to discuss from this basis. In most cases, you will request an adjustment on the monthly payment, which will then affect the rate and duration.
Once you have reached an agreement, you will then have a single loan with a new bank, and it is this bank which will be responsible for contacting the financial institutions with which you have your outstanding credits, and which will be responsible for reimburse them.
At this stage, we advise you to read our article on the management of consumer credit. It will help you to understand this new loan well and to manage it on a daily basis.
Should we play competition?
The repurchase of credit is a purchase of a financial product accompanied by the payment of a commission. As with any product purchase, it is therefore advisable to take advantage of the competition. The problem is that online simulation is not offered by all organizations, and that it is not always flexible. It is therefore often more efficient to approach a broker, because in view of the work that this requires, you could only do a fairly limited competition.