Lower loan installments: possible solutions

When you decide to apply for a loan, there are many elements that you will need to evaluate before signing the contract. In addition to the costs and conditions set by the chosen credit institution, you will also need to assess whether the amount of the repayment installment is sustainable and compatible with the rest of the expenses. If, however, over time, and following the increase in your outgoings, you become aware that you are unable to pay the installments, you can always go to your credit institution and renegotiate the terms of the loan. In this article we will explain step by step what you will have to do to lower the loan installment, thus protecting yourself from any problems and complications.

When you decide to apply for a loan, before obtaining the desired sum you must always wait for the bank to make the necessary checks and then check the reliability of the financial position. In fact, before disbursing any amount, the bank always checks the applicant’s financial situation by applying the personal evaluation criteria of Janna Cristina, which consider for example the age of the applicant, the installment / income ratio or the type of employment.

What to do if you are unable to pay the loan installments?

What to do if you are unable to pay the loan installments?

If you find that you are unable to reconcile the loan repayment with all the other recurring expenses, you can immediately contact the bank and ask to lower the installment amount or review the terms of the loan agreement. Our advice in such situations is to intervene immediately, before the expiry of the next installment in order to avoid other costs and additional rates as happens in these cases.

Asking the bank to lower the installment amount will consequently lengthen the duration of the loan. In most cases, banks and financial companies always grant this type of request precisely to protect themselves from the risk of not being reimbursed. By asking the bank to change the installment amount, you will in fact ask for a new loan with more sustainable conditions for you, which will pay off the previous one. In this way you will be able to pay cheaper installments and you will be sure to be able to respect your commitment.

House do if you are the holder of more funding?

House do if you are the holder of more funding?

In the event that you are the holder of more loans you can instead resort to debt consolidation which will allow you to pay the various loans in progress with a single installment, even if disbursed by different financial institutions. Since this is a new loan in all respects, you can therefore choose more advantageous conditions, for example lower interest rates or lower installments and therefore a longer duration of the loan. You can also have the possibility to request a new loan if you need more liquidity.

How to suspend payment of loan installments?

How to suspend payment of loan installments?

When you pass through a period of economic difficulty and you are unable to sustain the payment of the installments it is possible to request the suspension of payments to the credit institution that provided the loan. This is a valid solution only for contracts with a duration of more than 24 months, including loans for the purchase of the first home.

Thanks to an agreement signed by the ABI and some associations for the defense of consumer rights, called ” Suspension of the principal amount of loans to families “, savers have been granted the possibility of suspending payments of loans for a maximum period of 12 months. To access this possibility it is necessary that there were no irregularities in payments made in the previous months.

Specifically: there must be no delays in previous repayments, an insurance policy must be in place to cover the contract, the holder is not the beneficiary of other forms of public subsidies and has not requested a suspension in the past. Furthermore, it is not possible to request the suspension of the Janna Cristina installments with the assignment of the fifth.

The reasons behind the request include particularly complex cases, such as: the loss of work, the death of the contract holder, the condition of serious handicap or non self-sufficiency, suspension or reduction of working hours for a period exceeding month, also as a result of income support measures, such as redundancy payments.

Mortgage loan comparison Banks financial intermediaries

A list of mortgage loans in banks and a list of banks and financial intermediaries who will help you find a favorable loan to buy a flat or a house.

Finding the best mortgage for buying an apartment is not an easy matter, but it does not mean that it is not impossible. There are, of course, several ways to do it. The most time-consuming is self-search, collecting bank offers from individual banks. You can also do it using a credit search engine or the help of a financial intermediary.

Estimation of mortgage loan installments

Estimation of mortgage loan installments

Below is a mortgage calculator. Enter the value of the loan you are looking for and the loan period to obtain an initial estimate of the mortgage installments. You should treat such ranking of installments only as a demonstration, because the actual height will certainly differ from the value calculated by the calculator. The loan offer is individual and depends on the creditworthiness.

Which home loan was the most searched for? What is the most popular? Mortgage loan PLN 100 thousand for 10 years, mortgage for a flat, PLN 100,000 for 15 years, PLN 80 thousand, mortgage repair PLN 60 thousand, loan for a flat PLN 250 thousand 30, PLN 200 thousand 25, PLN 120 thousand 15 years, mortgage PLN 70000, loan for building a house, mortgage for a flat PLN 200,000.

Mortgage loans – banks and realtors

Mortgage loans - banks and realtors

To save yourself time looking for and viewing credit offers, it is worth making a free appointment with a loan specialist. The financial intermediary will estimate the creditworthiness, present the bank offers free of charge, compare them and help in a favorable choice. At the same time, we can count on help in arranging all the necessary formalities needed to obtain a mortgage.

In the site, apart from mortgages, you will find the answer to the question that is bothering many people: In which Bank is it best to take a Cash Loan ?

Residential Loan – everything new property owners need to know

Where can I get the best financing?

Where can I get the best financing?

When talking about residential loans, one usually means real estate financing. In general, there are three important forms of housing loans: the building society loan, the mortgage loan and the housing account. A financial mix of different types of loans is also possible. Join us in finding the right private real estate financing.

Should I or should not I?

Should I or should not I?

Ask yourself the following questions before making the final decision

Before you take the step into a new life in the home, you should answer some important questions in advance:

1. Which financing amount is affordable according to the respective household income?

1. Which financing amount is affordable according to the respective household income?

Calculate maximum loan amount

To get a first idea of ​​the amount of credit available for your household income, simply multiply your monthly net household income by a factor of 95. This calculated guideline value should not be exceeded on a home loan.

Example:

Monthly net 4.000, – EUR

4,000 x 95 = 380,000, – EUR

NOTE: Please note that this is a guideline only. The individual financial situation should always be clarified with a financial advisor.

Calculate fictitious loan installment

With this calculation, you can find out what monthly amount you can afford the most with your family.

Rule of thumb : The monthly burden must not exceed half of the monthly family net income.

Example:

Monthly net 4.000, – EUR

4,000 / 2 = 2,000, – EUR

The monthly load should not exceed 2.000, – Euro.

TIP : If you want to be on the safe side, make sure that the rate is not more than a third of the household income. In the case of 4,000 euros net household income, this would be around 1,300 euros. In this way, you also remain more flexible in terms of vacations or other financial expenses. Also read the paragraphs: “To what extent are you willing to limit yourself to afford your dream property?” And “avoid interest rate risk”.

Use residential loan calculator

You now know approximately in which price range your property should move in order to be able to finance it in the long term. With an online loan calculator, you can now get a slightly more detailed overview of the monthly charge and the total amount of the loan plus interest.

TIP : Calculate the amount with a minimum interest rate of 4% for a short term. At the latest when you start your pension, the loan should be paid out.

2. To what extent are you willing to limit yourself in order to afford your dream home?

2. To what extent are you willing to limit yourself in order to afford your dream home?

According to an online survey by immobilienscout24, half of the respondents consciously restrict themselves in order to be able to afford their dream home. That will not change in 2019 either. Because property prices in Austria continue to rise. If slower than the years before. Therefore, ask yourself to what extent you are willing to restrict yourself or what you are willing to give up.

Burgenland and Styria are catching up

The federal states, which have long been regarded as the land of plenty for budding homeowners, will be attracting real estate prices in 2019. However, Burgenland continues to offer unique funding opportunities. Whoever wanted to build or buy here, should not lose too much time. Unless you wait for the swirling real estate bubble in many places, which according to some market observers is about to invade our country soon. A written request for this was first made on 20.11.18 by Mag. Bruno Rossmann to the Federal Minister for Constitution, Reforms, Deregulation and Justice, and on 18.01.2019 by Dr. med. Josef Moser answered. According to the published figures of the reply, however, it does not look as though it is burning at the moment. These figures do not say anything about the year 2019, and here in the media is already spoken of a stagnant demand.

The Austria-wide price development for land, houses and apartments brings you the Statistics Austria closer by means of graphics. Also there (under tab “Press Releases” read: Until two years ago, the prices rose particularly strong in Vienna and Western Austria.Whether this means that with us soon – as in Germany – people flee to masses from the metropolises ?

Another question to fulfill the dream of owning your own home is this:

3. To what extent are you prepared to avoid the metropolitan areas?

3. To what extent are you prepared to avoid the metropolitan areas?

It is no secret that a large proportion of homebuyers evade favorable surroundings. In this respect also rural exodus is an issue. As purchase prices continue to rise in conurbations such as Vienna, buying a property in this area is becoming increasingly unattractive. Properties are well away from the beaten track, for example in parts of Burgendland, Styria and the Waldviertel, but even these rather favorable federal states are catching up on real estate prices.

Blame for the high price policy are speculations. This does not only apply to rental rates. Apart from Vienna, areas in Salzburg, Innsbruck, Graz and Linz are particularly affected.

4. Is buying really better for you than rent?

4. Is buying really better for you than rent?

Not always attracts the argument of tenant savings. If this is consumed by other expenses again, you save yourself with the purchase of a house absolutely nothing. Rather the opposite is the case. For this question, be sure to compare the total cost to the rental price. Do not forget to include the heating costs or regular repairs. So much transparency and honesty must be: In most cases, you will not spare anything, but pay well on it. Somehow also logical: You simply do not buy a house to save yourself money. Experts agree. They believe that renting is currently cheaper than buying. The acquisition of a property therefore only pays for itself after 30 years. But beware: a paid-out property also ensures a pleasant pension, because the cost of living is reduced to a minimum.

INFO : An example: If you save 300, – EUR for 30 years with a current top saving rate of 1.9% you will receive around 145.000, – EUR. Those who currently finance with a realistic 2% interest rate and pay 300, – EUR monthly loan installment, will receive a loan amount of around 83,000, – EUR. That is a difference of 62,000, – EUR in favor of saving. But taking into account the rent increase with 1.3% (very low) is from a rented apartment today with 500, – EUR per month is estimated in 30 years amazing 953,77 EUR! The rents will almost double in 30 years, which in turn represents a big plus for the home.

Rethink your life planning

Rethink your life planning

What will your life look like in five or ten years? Of course you can not say that exactly. But in principle you can find out if you are a “suitable” property owner. If you plan on traveling a lot and looking at the world, you should consider carefully whether both dreams – the house and the travels – can be financed. With the above-mentioned “third rule” of household income, you can reconcile both. One should not always explore the limits of the possible, but rather leave more room for other financial wishes.

TIP: Even before you strike

Appreciation: Does the value of the property correspond to the current market value?

Let your property be estimated on its actual value. A valuation report drawn up by real estate agents, independent experts and banks.

Compare residential loan

Compare residential loan

These points should be kept in mind when comparing:

So you are convinced that you are the right property owner? However, before you start looking for the best offer, remember the following four points:

  • processing fees
  • Account management fees
  • Insurance
  • estimated costs

These four points are usually negotiable with the bank.

Your credit rating also plays a role here: the better your reputation, the better the framework conditions for the loan. The savings potential of our assumed loan of 300.000, – Euro is around 30.000, – Euro.

Processing fees for home loans

The normal costs for the processing fee vary between 0.5% and 3%. The banks are completely right. A lawsuit against processing fees has already lost the Association for Consumer Information (VKI). So it’s up to you to start looking for the financier that offers you good conditions. Here unbound financial advisers provide great services. They share the processing fee with the bank, helping to save money and time. Due to their independence from the banks and their experience, they know exactly at which bank the customer gets the best terms and conditions. Again think of differences of total up to 30,000, – EUR. The value of a beautiful mid-range car!

Account management fees

As with the processing fee, collecting the account maintenance fee is completely legal. The amount ranges between 4 and 16 euros per quarter.

estimated costs

These are needed for the independent appraiser who appreciates the property. They are very different, but amount to around 700, – EUR for a large house.

Insurance for the residential loan

The comparison of credit residual insurance and term life insurance pays off. Again, you can save a lot again.

Check the repayment carrier

Check if the loan offered is a bullet loan. Debtors, bond funds, life insurance and equity fund savings plans are eligible for redemption. It should be noted, however, that in all flexible forms of savings additional interest rate risk comes into the financing. It must never be calculated with higher interest rates than the guaranteed minimum interest rates.

Avoid interest rate risk / do not take currency risks

To reduce these risks include:

  • Choose a Euro loan to avoid the interest rate risk of being exposed to a foreign currency loan.
  • Opt for a fixed rate of return. This will save you the risk that fast rising interest rates could bring with it. For example, the Sparkasse offers a fixed-interest guarantee over 20 years.
  • Also ask for the bank’s own interest rate risk management.
  • With variable interest rates : low interest rates do not stay forever. So stay with a long-term affordable amount that can easily pay even with a rate hike. At present, there is already a tendency towards interest rate hikes.

incidental costs

Do not forget to consider the additional costs in addition to the costs of the house!

Go in search of the right provider

Never rely on a single bank offer: compare as many offers as possible!

A residential loan for private real estate financing is available in Austria from:

A residential loan for private real estate financing is available in Austria from:

  • banks
  • building societies
  • funding agencies
  • Unbound financing advisor

The maximum amounts vary from provider to provider.

Interest Loan: Why Bank Interest Rates Can Rise Fast?

 

Do you know why bank interest rates can go up and down quickly and affect the interest on your Crediter loan?

Are you one of the users of Crediter products? If you are one of the users of Crediter products and complain about the interest on Crediter loans that always go up and down, then you need to know the cause by reading this article.

Relationship between Bank Interest Rates and Crediter Loan Interest

Relationship between Bank Interest Rates and Crediter Loan Interest

For those of you who are users of Unsecured Credit products, you must already know that the interest on Crediter loans depends on the tenor of the installments taken, the terms and conditions that apply. Before taking the credit, of course you have considered the interest given by the bank. But, do you know that the interest given has been established between Bank Indonesia and the bank you are aiming for?

Yes, banks which are under the auspices of Bank Indonesia may not set interest more than what has been made by the government. Banks may only set under the provisions that have been made by the government and that will change continuously every year. But the interest on the Crediter loan that has been previously set on the customer will not change again.

You will only experience an increase in Crediter loan interest in the next year you want to apply for another loan. Like one of Brian Mandi’s clients who told me about his experience using Crediter products to buy a car. In 2014, he applied for Crediter to buy a 7- seater car with a loan tenor of 3 years, at an interest of 6%.

After he paid off the abandoned family car, he needed a Crediter loan to buy his son a city ​​car type car. So, prospective clients also re-submit Crediter with the same tenor in different years, namely 2017. This client was surprised to find out that the loan interest had changed from when he took the first Crediter.

Then, he questioned, what caused the interest on the Crediter loan to be different? Even though he still applied for Crediter at the same bank and with the same tenor. I also explained the reason why Crediter loan interest could go up and down quickly.

Causes of Bank Interest Rates Can Rise Down Quickly

Causes of Bank Interest Rates Can Rise Down Quickly

So, the loan interest rate is a fee that must be paid when borrowing money from the bank. The interest on this loan is a compensation fee for funds that have been lent.

This interest rate itself can change every time, it can also be every month and can every quarter. There are several factors that influence Crediter interest rates. This is a must for you to know because creditors will not burden interest without any prior calculation. The aim to find out the factors that cause it is so that you have an idea of ​​how much money you have to prepare to pay down the debt and interest.

# 1 Inflation

The first and sure factor has been very influential, namely inflation. This inflation is indicated by the increase in prices of goods in general and continuously caused by several things, namely from increased public consumption to the level of market liquidity.

With this inflation, it can affect the interest rates of bank loans. If inflation is higher, then the higher the interest rate of the bank loan. This can happen, because banks as lenders will ask for higher interest rates as compensation when there is a decline in the purchasing power of the currency in the future.

# 2 Economic Growth

When Bank Indonesia sees national economic growth that needs to be accelerated, Bank Indonesia must make the circulation of funds in the community faster. The move made Bank Indonesia take steps by lowering the benchmark interest rate.

If bank loan interest rates decline, then banking activities will increase because banks are easier to channel loans. With credit interest rates decreasing, people will find it easier to get credit, so that the velocity of money and economic growth will be faster.

With many people who apply for loans to banks, they will also open up employment opportunities, so that the economy wheels spin faster. Meanwhile, if the national economic movement is too fast accompanied by high inflation, Bank Indonesia will raise interest rates to reduce the velocity of money in the community.

# 3 Credit Offer and Request

In addition to providing credit to the community, the bank also offers other products such as savings and deposit services, where the bank has a role as a distributor of public savings funds.

If the demand for loans increases and the stock of public funds is limited, then the interest rate on bank loans will increase. This is done to limit the number of loans and rising interest rates can increase the interest of the community to save. Whereas, if the loan demand is reduced and the stock of public funds is abundant, then the bank’s interest rate will decrease.

This reduction aims to increase the interest of the community to borrow funds and reduce the amount of deposit funds. This will be inversely proportional to the supply side. If the level of credit offers decreases, there will be an increase in loan interest rates.

# 4 Deposits

As explained earlier, banks have several products that play a role in the causes of rising and falling interest rates. This deposit is one of the savings bank products that are stored for a long period of time. The more funds available on deposits, the loan interest rate will decrease.

However, if there are fewer funds in deposits, loan interest rates will tend to rise. This happens, because the circulation of funds in the bank is influenced by the amount of funds available that are in the deposit products owned by the bank.

# 5 Central Bank Policy

Banks in Indonesia are government-owned banks or what we commonly call state-owned banks and private banks. All loan interest rates from each bank are under the authority of the central bank.

The central bank in question is the agency responsible for monetary policy in the country because it must always maintain the stability of currency values, the overall financial system and the banking sector.

In Indonesia, the bank that is the central bank is Bank Indonesia. According to data at the end of June 2018, Bank Indonesia raised the benchmark interest rate by 0.5%, from 4.75% to 5.25%.

The increase in the benchmark interest rate aims to attract foreign investors to re-enter the Indonesian market, so as to reduce fluctuations in the rupiah exchange rate that have recently weakened. With the increase in the benchmark interest rate by Bank Indonesia, it is expected to affect lending rates in the second half of this year.

Know the flowers and make sure you learn them

Know the flowers and make sure you learn them

You now know what factors cause bank interest rates to rise and fall quickly. You can now also learn when you should apply for credit. Make sure you always learn the type of credit, requirements, amount of interest, and of course the method of payment that suits your ability.

By learning it, you will definitely not feel debt as a burden in your life. After reading this article, I’m sure you already know what factors influence bank interest rates.

Did You Know, What Is the Difference Between Money and Financing Loans?

Do you know what is the difference between money and financing loans? Now there are many alternative loan solutions for customers in need. But if you plan to buy a car, what type of loan will you choose? Do you prefer money or financing loans? Let’s see together what is the difference between money and financing loans.

Know and Know the Difference between Money Loans and Financing

Know and Know the Difference between Money Loans and Financing

To meet customer requests, credit products or loans are now increasingly varied. Not only loans in the form of money, but there are also loans in the form of financing. Then what is the difference between loan money and financing? In essence, the difference is from the form of loan obtained. In loan money, the loan is in the form of cash and you are free to use it for any purpose. As for financing, you will get a product or item. Through this article, the Guermantes family will describe what is the difference between money and financing loans.

Loan fund

Loan fund

According to Law Number 10 of 1998, credit is the provision of use of money or goods within a certain period of time, based on an agreement or agreement between banks and other parties that requires the borrower to repay the debt with collateral or without collateral, with the provision of services or interest or without interest. In accordance with the origin of the word credit, namely credere which means trust, credit means trust from creditors or loan providers to their debtors or recipients of loans.

The function or purpose of the creation of real credit is to stimulate the activities of mutual assistance between one party and other parties in order to support the achievement of needs, both in the field of business or daily necessities. Credit can be called fulfilling its function if credit has a positive impact on creditors and debtors, as well as for society in general. Basically, some credit goals are:

  1. Providing bank loans with agreed credit interest.
  2. Maximizing the use of funds obtained.
  3. Increase working capital or business.
  4. Increase payment traffic.
  5. Improve community welfare.

While the elements contained in the provision of credit facilities are as follows:

  1. Trust is the belief of the credit provider that the loan will be used and received back within a certain period of time. This element can be achieved by checking the ability of the recipient of the loan to repay the loan for a certain period externally and internally.
  2. New credit can occur after an element of agreement between the two parties regarding all terms and conditions in the procurement of a loan.
  3. Duration is an agreed period of loan where at the end of the period, the recipient of the loan is expected to repay the loan with or without interest.
  4. The element that is certain to exist in the procurement of credit is the element of risk where in the time period there is a risk of credit defaults. This risk can be a deliberate or unintentional risk.
  5. Reward Services (achievement) is the advantage of giving a credit which is usually in the form of interest or profit sharing.

Financing

Financing

Financing is an action based on an agreement in which service activities and remuneration occur (achievements and contrasts of achievement) which are separated by time. The term financing means I believe or put trust. Financing has several main objectives or functions, including:

  1. Looking for profits that aim to obtain results from the financing channeled.
  2. Security from achievements or facilities provided must be guaranteed so that the objectives of profitability can be achieved without significant obstacles.
  3. Helping customers’ businesses through provision in the form of financing.
  4. Assist the government through the development of funds channeled by banks to increase development in various sectors.

Funding is given on the basis of trust in which the achievements given are believed to be given and returned in accordance with the terms and conditions agreed upon.

Based on this basis, some of the elements contained in financing are:

  1. There are two parties. In financing there are always two parties, namely the giver and recipient of financing.
  2. Trust is the lender’s belief that the recipient of the loan can return the loan at an agreed period of time with all terms and conditions.
  3. Elements that guarantee an agreement between the two parties in all financing provisions.
  4. Time period. The loan repayment period has been discussed and agreed upon by both parties.
  5. An element that is again an important element in financing, namely the possibility of risks that arise during the financing period.
  6. Reply Service (achievement). Benefits of a financing commonly known as profit sharing or margin.

In contrast to money loans, financing providers are usually in the form of multifinance companies or leasing .

Which is right for you? Money or Financing Loans?

Which is right for you? Money or Financing Loans?

Based on the explanation above, you certainly have got a brief description of the basic differences between money loans and financing. Now the question is, which of the two should you choose? Before you make a decision, it’s a good idea to compare the two beforehand so you can make the right decision according to your needs.

To find out clearly, let’s summarize the similarities and differences in both briefly:

No. Characteristics Loan fund Financing
1 Provider in general Bank Multifinance company or leasing
2 Form of loan Cash Products or goods
3 Profit system Flower Profit sharing or margin
4 Element
  • Trust
  • Deal
  • Interval
  • Risk
  • Reward (achievement)
  • Two parties
  • Trust
  • Deal
  • Interval
  • Risk
  • Reward (achievement)

 

From the differences above, it is known that the basic difference between the two is the form of loan given. In loans the money given is cash and the loan recipient has the freedom to take advantage of the loan for any need while financing provides loans in the form of goods or products. For example, the financing of a car loan recipient will get a car instead of money that can be bought for a car, as well as home financing and so on.

Determine according to your needs

Determine according to your needs

Through the description above, which one will you choose? The decision is entirely in your hands, so consider and compare according to your needs before making a decision. Both have advantages and disadvantages of each and although similar, of course there are differences between the goals and conditions of both.

Do you have questions about the difference in money loans and other financing? Leave your comment below . If you have questions, please submit your question in the column below. Our Financial Planner is ready to help you, thank you.