People suffocated by the monthly payments of their numerous debts often ask themselves: can the loans be reunified? The answer is yes.
What is debt reunification?
This procedure allows grouping all active loans and mortgages into a single loan. In this way, only one monthly fee must be paid, renegotiated; and with an amount less than the sum of all the fees that were required to assume.
Consequently, the financial requirement that is supported each month is reduced, optimized and simplified. As reunification makes it possible to respond to a single creditor. In return, the repayment term increases and, therefore, also the total cost of the full payment, because interest increases.
Who can manage a loan reunification
People who see an opportunity in this formula have two options. Go to companies specialized in this activity, known as mediators. Or negotiate with the bank with which they have contracted most of their outstanding debts.
What is the acceptance process?
The procedure is similar to any other credit application. The company or entity collects the information it needs, studies the specific case and assesses which and of what nature these debts are; what interests are being paid, what repayment terms have and with what assets and economic income the debtor has. Analyzing everything, the operation will be approved or not and the renewed payment conditions will be defined.
If the initiative comes to fruition, all debts will be canceled and reunited in a single new loan. Which will allow to fulfill all these payment obligations in a more rational and acceptable way; With a lower monthly fee.
The dark side of loan reunification
This formula is a possibility, but in no case should it be the only salvation table. Because it can generate more damage to its beneficiaries : the repayment periods increase greatly and the interest is usually higher. In general, the initial fees are lower, but they are increasing progressively. What sometimes produces a return or a worsening of the critical initial situation. In any case, although the monthly payments decrease, the total debt increases.
Types of reunifications
There are two major types: non-mortgage and mortgage.
The first are, in reality, a new personal loan for the value of all debts. If you opt for them, you must also consider the expenses and costs of the new loan and cancellations. Often, they require the figure of a guarantor. Mortgage companies are the most frequent and use the property owned by the contracting party as a guarantee of payment; as long as it is not already mortgaged.
Can the loans be reunified?, was the issue. Yes. The question now is: do you really care? If you are looking for financing, look no further, compare the best loans in Ideal Loans.