How to cancel a revolving credit?

Here’s how to cancel a revolving loan.

Revolving credit: termination

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A revolving loan (formerly revolving) is a reserve of money made available to the borrower and enabling him to settle consumer purchases. These loans are often based on high rates, sometimes even close to the legal limit of 20%.

There are four ways to terminate revolving credit:

  • Termination during the legal withdrawal period
  • Termination on anniversary date
  • Termination after two years of non-use
  • Termination by credit consolidation

Terminate the revolving loan: legal withdrawal period

 Terminate the revolving loan: legal withdrawal period

The law on consumer credit specifies that borrowers have 14 days to terminate an offer of revolving loan from the signing of the contract. It is enough to send a letter of termination by registered letter during this legal period. Often, the contract provides for a termination letter.

Terminate revolving credit on anniversary date

 Terminate revolving credit on anniversary date

Renewable loans are taken out for a period of one year with automatic renewal, that is to say that without termination action, the contract is renewed for a period of one year. To cancel the loan, it is sufficient to send a cancellation letter by registered letter with acknowledgment of receipt no more than 20 days before the anniversary date. The lender is required to send 3 months before the termination terms.

Terminate credit after 2 years of non-use

 Terminate credit after 2 years of non-use

If the borrower does not use the revolving loan for a year, it becomes inactive but can be activated at the request of the borrower. After two years of non-use, the contract is automatically terminated.

Good to know : payment cards associated with revolving credits offer two payment options, cash or credit (sometimes represented by the number 1 or 2 on the payment terminal). It happens that some consumers mistakenly use the “on credit” mode and therefore activate the money reserve, in this case, just contact the lender to indicate that it is an error, the latter may deactivate the use of the revolving loan.

Terminate revolving loan with credit consolidation

It is not a method of termination but a possibility of settling the revolving loan. Credit consolidation is financing which consists of combining several loans into one. The credits are therefore settled and the remaining capital to be repaid is carried over to a new credit contract which is based on a new term, a new rate and a new monthly payment.

The operation may entail costs and a possible increase in the total cost of the credit.

Remember that before you take out a loan

Many people wonder how it is possible that loans that were advertised as very cheap actually have huge costs for them. In this article, we present a package of the most important information about APRC and RSO – these are two extremely important indicators, thanks to which you can get a lot of information about the cost of a given loan. We invite you to read carefully!

Remember that before you take out a loan

Remember that before you take out a loan

The vast majority of borrowers consider the interest rate on a given product to be the basic criterion before making any commitment. They pay special attention to interest rates. Another value, the APRC, is also very much related to the interest rate. Each bank and non-bank institution is obliged to provide each loan or loan with the offer. Some misidentify the APRC and RSO – these are values ‚Äč‚Äčthat are very different from each other.

So what are the differences between APRC an RSO? How does the lack of one letter “r” translate into the final cost of a loan or credit? How do financial institutions manipulate borrowers to encourage the use of their offer? Below we are unveiling the secret.

Definition of APRC

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APRC is one of the most important indicators. It indicates very precisely the total costs of a given loan or loan. The abbreviation for the APRC is the Actual Annual Interest Rate.

This ratio determines the percentage ratio of the total cost of credit to its amount – the sum of money we borrowed from a given bank or non-bank institution. In a situation where we take out a loan of USD 100,000 and all the costs of a given loan amount to USD 10,000, the APRC will also be 10%.

In comparison to the nominal interest rate, which banks usually promote their offers, the APRC includes virtually all fees related to granting credit. The standard nominal interest rate includes only the margin and reference rate. Apart from these two components, the APRC includes cross-selling, commission, and all additional services.

Definition of RSO

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RSO is an abbreviation that many people mistakenly identify with the APRC. This value is very different from the Real Annual Interest Rate described above. The whole myk results from the lack of the word “real”. The value of the RSO has virtually nothing to do with the total cost of the loan. The annual interest rate (RSO) is really the value of the interest rate on the loan – the sum of the margin that a given bank or financial institution will earn on our product.

This indicator also includes the reference rate set for a given loan. RSO does not take into account any other costs – we are talking here about foreign currency loan tax, commissions, loan servicing, etc.

APRC and RSO – the number of differences is huge

The differences between the APRC index and RSO is a whole bunch. In the case of some loans, it may even amount to tens of thousands of zlotys. Even in a situation where an institution boasts that its annual percentage rate is 0%, in practice, it can mean great costs for us.

Credit repurchase, under what conditions?

 

The conditions vary according to the banks and the credit organizations but also according to the profile of the borrower within the framework of a repurchase of credit, here are the main conditions proposed.

Loan buy-back: conditions linked to the transaction

Loan buy-back: conditions linked to the transaction

It is essential to demonstrate that there are two different operations which are however confused by most of the people. The repurchase of credit is the fact of having his home loan redeemed only by another bank. Credit consolidation is the fact of combining several loans into one to generally reduce the monthly payment. The conditions are not the same because in repurchase of credit, the approach is oriented towards a low rate whereas for a grouping of credits, the approach is linked to a reduction in monthly payments. Two different needs, two different offers and therefore different rates, often higher in loan consolidation.

Conditions and fees for credit repurchase

Conditions and fees for credit repurchase

First of all, the lender must prepay the credits in order to be able to recover all the debts and therefore propose to the borrower a new contract. Early repayment indemnities are to be provided, up to a maximum of 3%. Then, the administrative and / or mandate fees can amount to a maximum of 7% or even 8% of the amount financed. Finally, if there is a mortgage guarantee in place, notary fees will be expected, according to a national scale updated each year. In terms of conditions, the rates remain attractive for this type of transaction and it all depends on the profile of the borrower. The higher the borrower’s income and the ability to repay over a short period, the lower the rate.

Credit repurchase: duration conditions

Credit repurchase: duration conditions

On a repurchase or a grouping of mortgage loans, the durations start at 60 months (5 years) and go up to 420 months (35 years), the so-called consumer buy-backs are on shorter durations, from 12 to 144 months ( ie 1 year to 12 years). Beyond that, it is the repayment capacity calculated with the remainder to live and the debt ratio which will make it possible to know if the borrower’s request is admissible or not. Otherwise, the credit buy-back simulation allows you to quickly know if the file can lead to a financing agreement, free of charge and without obligation.

Simulate to know the conditions

Simulate to know the conditionsSimulate to know the conditions

It is clearly impossible to give financing conditions since each situation for a grouping of credits is unique. That said, the simulator makes it possible to obtain an estimate of its future reduced monthly payment for free and without obligation. Just complete the form and then validate it, the result will be quickly communicated with the different funding possibilities and therefore applicable conditions.

A loan without proof is possible!

 

Obtaining a personal loan without salary or at least a loan without proof of salary is not easy. If the proof (s) of income are not present at the meeting, on the contrary, and it is more often than not the desire that is lacking, however, as a general rule.

Indeed, when we wish to invest / invest in a project that is close to our heart, most often, we are impatient like a child on Christmas Day for whom the time to open his gifts is too long overdue. taste. It is both normal and human and even if obviously there will always be people who are less impatient than the first, we easily understand the others.

Reminder of how loan allocation works

Reminder of how loan allocation works

Already and to start by making a little reminder of the modes of allocation of credit requests, let’s start by indicating that it is possible. Well, after, indeed, it is not the most usual operation and the banks which will agree to make you a loan when you do not present them with proof of income are not legion, but in theory it is everything made possible.
Personal loans belong to the category of consumer credits, a category in which there are several types of credits, assigned credits and unrestricted credits. In the first of these two categories, you find as their name indicates all the forms of credit which aim to meet a clearly defined purpose and to finance something very specific as is the case of a loan auto for example to take a very common and well-known example.

In the second category, that of unrestricted credits. There too, the name is representative of the form of credit and in this, the borrower is free to use the sum lent by the banking organization as he sees fit: travel to a distant destination and bathed in sunshine or snow to offer you an exotic stay, financing the studies of children or grandchildren if the latter decide to continue their post-bac studies in a school whose education is certainly very qualitative but quite expensive, do some work in your home to improve comfort and / or enhance it for future resale, etc. It is in this second category that between the personal loan which is to date one of the only for which you do not have to account for how you will use your silver.

The disadvantages of a personal loan without proof

The disadvantages of a personal loan without proof

As you can imagine, if in theory it is possible to obtain a personal loan without salary or income * to justify, as this represents a higher risk for the lending organizations which would be ready to grant it to you, there will necessarily be a consideration. The latter, you guessed it will be on the rate at which the sum will be advanced to you.

The other disadvantage is that as we started to mention above, if in theory this kind of loan is possible, in fact the banks also take advantage of the fact that they themselves are never obliged to grant you a credit under such conditions and that according to their own criteria, they require proof of salary to give a favorable response to your request. Therefore, the disadvantage if you are looking for a personal loan without salary and you risk to multiply the steps with many banking organizations before ending up perhaps having very little incentive conditions.

How else can you try to get the funds?

How else can you try to get the funds?

If you cannot go to your bank or another banking organization without being refused, what are the other solutions available to you? As we will see with the case of stores in the asterisks below, you may be able to get a slightly different form of loan by deferred payment.

If you have another type of need or it is not negotiable, it becomes more complicated, it must be recognized. Therefore, apart from being lucky in the lottery or the skyscraper, we only see the loan made by someone you know and who will agree to do it for you on the basis of the trust they have in you but it is true that it is a situation which can prove to be delicate.