Debt Consolidation: What Is It?
The loan or loan for debt consolidation, commonly known as refinancing, is a recently created tool created by financial companies to facilitate the payment and the closure of several ongoing loans taken out by the same subject.
Those who had taken out several loans and for the most varied reasons have not been able to pay a few installments, or feel suffocated by the total sum of all the installments, have the possibility to request a single loan, obtaining a single installment to be paid, much more slight amount of the installments due for current loans.
Through debt consolidation, an amortization plan will be chosen with a credit company, which will establish a single monthly installment whose value will always be less than the total value of all the accrued installments.
By requesting a loan for debt consolidation, instead of a loan, not only can all the ongoing loans be extinguished, but you can get additional liquidity by giving new life to your daily life. Debt consolidation and additional liquidity are usually granted when a property on which a mortgage will be suspended pending resolution of the debt is pledged.
Obtaining a debt consolidation mortgage has 3 main advantages:
- The financial life of the applicant is simpler : those who request a mortgage of this kind, find themselves having a single commitment with a single credit institution, therefore a deadline to be fulfilled and not perhaps 4 installments to be paid to 4 different institutions in 4 maturities monthly that do not coincide.
- The installment to be paid is always lower than the total of the previous monthly installments : a definitely more convenient solution for the portfolio and for the personal and family budget.
- When the guarantees allow, an additional liquidity of up to approximately $ 50,000 can be requested : usually in these cases, a property whose mortgage can reach a maximum of 80% of its value is placed in support of the further loan.
What are the possibilities for those enrolled in the CRIF?
The debt consolidation for bad payers, as well as for the protested or the more fortunate permanent and fixed-term workers, as well as for the pensioners, can be assimilated to a common personal loan.
If for a worker with a permanent contract, overburdened by the installments, it is much easier to obtain a loan or a loan for debt consolidation, the solution changes for those who are left behind with one or two installments in repaying a loan. In fact, failure to pay even a single installment of a loan in progress, leads to the reporting of the debtor in the Credit Information System, better known as CRIF, which does not “stain” the reputation of the interested party until the 2 is reached or more installments that remain unpaid.
Once enrollment has taken place, obtaining a debt consolidation for bad payers is contemplated, but it is carried out in the opposite direction. In fact, the members of the CRIF, not being able to directly access a loan for debt consolidation, will have to turn to a loan with a transfer of the fifth or to a loan changed.
These two financial instruments differ from the actual debt consolidation loan because the credit company will not cover the accumulated debts with the loan, but the applicant will have to personally deal with the closure of the individual loans.
How does it work
Most of those who have been included in the CRIF “black list of bad payers” for not having paid more than 2 installments or because they have protested must first of all present essential characteristics for the credit company to take the refinancing request into consideration:
- be permanent employees for a minimum of 4 to a maximum of 24 months, according to the credit institutions
- being a fixed-term employee for at least 4 months and not having too much debt
- to be retired
- be between 18 and 86 years old i
Keeping these characteristics in mind to consolidate your debt you will certainly have access to the transfer of the fifth through which it will be not the contractor, but the employer or the pension institution, to transmit the installment of the loan to the credit company. By acquiring the debt, the contractor may request the cancellation of his name from the CRIF list.
Self-employed workers, already enrolled in the CRIF or protested, can start a debt consolidation for bad payers using the formula of the promised loan: this financial instrument guarantees the recovery of the financed money, the promissory note, the executive title par excellence.
In this way, the applicant signs a formula, which provides for the possible attachment of movable and immovable property in the event of non-payment of the security: the guarantee therefore, in addition to the security, comes from the possession of private property.
In the event that no seizable assets are possessed, the subscription of a loan changed must be accompanied by a guarantor. Usually, these types of loans are also called fast loan loans precisely because of the speed, approximately 48, of the approval.
Anyone who decides to apply for a loan of any kind to a bank or financial company, the first thing the latter will do is to ask the Central Credit Register for information. If the reliability and punctuality of payments have been respected in the past, it is certainly a very important factor in deciding whether to disburse the loan.
To this are added other elements, very interesting for the bank:
- the amount of movable and immovable property owned will be important, because they can provide the guarantee to cover the debt that the bank needs;
- the existence of a guarantor ;
- the existing debt exposure, or the difference between the income and expenses within the applicant’s family unit. Consolidation is much more likely to be granted when the sum of the installments to be paid does not exceed one fifth of the salary, settling below 20% and in any case never exceeding 30%.
If debt consolidation for bad payers is the formula that best suits your financial condition, let’s see together what we will have to do once the threshold of a credit agency has been crossed. You will first need to bring all the documentation that you certify:
- The identity of the applicant;
- The tax code;
- The documents of each ongoing loan;
- The paycheck
Financial companies that provide loans for debt consolidation
- the debt consolidation Findomestic will be granted to all those who have an indefinite contract of employment with at least 12 months’ seniority, pensioners, but not protested, those who have undergone foreclosures or registrations to CRIF;
- Agos debt consolidation will be granted, according to the situation of the applicant, to those who have a permanent contract for at least 12-24 months and the pensioners
- Compass debt consolidation is paid to those who are in possession of a paycheck or retirees, with working seniority between 12-24 months.
Those in possession of these requirements will face with the consultant an extinct count, that is the sum of the debt of all the loans, excluding un accrued interest. The sum of the penalties for early repayment will be added to the total, which cannot however exceed 1% of the total.
At this point you will have the amount to be requested to pay off the current debt with all the credit institutions and if the guarantees allow, you can also ask for some liquidity to give breath to the portfolio. We will calculate the single installment to be paid to the financial, monthly installment to be paid to a single institution, with a subsidized interest rate and a lower amount.
A convenient solution, which is now increasingly popular with savers.
Certainly the convenience of being able to deal with a single institution instead of 2, 3, or 4 has its advantages: since the companies that are offering this service are increasingly numerous, our best advice is to find the debt consolidation offer. for bad payers best of the moment. Maybe you will be able to save a little bit on interest and you can receive better conditions for payment. Searching does not harm.