When we talk about “refinancing to pay off debts” then comes the idea that it would have to make a new debt over one that is already in progress. I say that this is half truth, the refinancing can be completed also with goods that are already totally removed. This feature as well with buying debt (selling loans) in recent times has been much sought after by people who are having debt and want to get out of debt situation.
Of course, no one in their right mind wants to stay in the red, with late bills, name going to the SPC and Serasa, having notices at notices and phone calls from creditors at all times. This brings frustration and wears out any good citizen. The day-to-day routine of economically active people is not easy, running, working, studying, traveling, and in one of these the unlikely can happen, everyone is subject to unforeseen and unexpected expenses at any time.
One hour you realize that your finances are out of control – now what? The question that troubles the mind of all in debt is – will I be able to pay this debt before interest swallows me up? In these types of situations it is best to pay the debts by anticipation , that is, to remove the debts completely, but this action will require of high amounts depending on the outstanding balance.
If you are currently in need of borrowed money and no longer have personal loan lines available, the tip is you opt for refinancing.
Refinancing to pay off debts
“Refinancing is a personal credit modality that frees up cash amounts for people who have loans in progress (payroll) and for who owns assets and wants to give them as collateral in the operation”
What refinancing arrangements exist
When talking about refinancing, most of the articles mention only two types of operation, however we can add one more type, let’s see what they are:
- Refinancing Personal Loans
- Refinancing of vehicles
- Real Estate Refinancing
Hiring a refinance in any of the modes is very interesting especially for people who are in debt to personal credit lines, expensive personal loans or that have the dirty name in the protective organs.
1. Refinancing loans
To make a loan refinance, especially payday loan to negative, the borrower must have paid at least 35% of the agreed contract. This is a common way for retirees, pensioners, civil servants and military to borrow money by renewing their payroll loan.
2. Refinancing of vehicles
In this mode it is not necessary to sell the car to get money, just have a vehicle totally removed and that is in good condition that the request for refinancing happens without problems.
The refinanced vehicle is disposed of as collateral for the lending bank or financial institution. The amount borrowed can reach up to 90% of the value of the car in the FIPE table with installments in up to 60 months.
3. Real Estate Refinancing
When refinancing your property, in addition to allowing you to reduce monthly expenses with other loans, organize your home finances, you still manage to replace some interest rates on current financing debts by lowering the installments to suit your current financial situation.
The operation is granted to both individuals and entrepreneurs and small business owners who need money for their own use or to use the financial resources for working capital, business expansion and more.
The banks release up to 50% of the current market value of the property, as well as having excellent interest rates, starting at 1.00% per month and repayment terms of up to 360 months. The amounts released amount to R $ 1,000,000 even if the person has a cadastral restriction in SPC and Serasa.
4. How Refinancing Works
Each type of refinancing has its own credit rules and policies, it is necessary to understand the minimum of how each one works.
If you want to know more about refinancing loans and assets just call your manager or contact a financial institution whatsoever.
► As you can see there are two types of refinancing: those with property collateral and refinancing without collateral. It is worth mentioning also that the term for payment of the parcels that each offers are different:
- Loans – Up to 99 installments, without guarantees.
- Vehicles – Up to 60 times, with warranty.
- Real Estate – Up to 360 months with warranty.
5. For whom refinancing to pay off debt serves
“Refinancing in general serves to assist individuals and borrowers in obtaining money to use as they wish, including honoring debts and financial commitments, as well as reducing total costs with interest and installments”
Our tip: When your option is to refinance assets involving vehicles or real estate, they will be the lender’s guarantee, so they will be sold in the name of the lender until the full settlement takes place.
Be careful, even in refinancing to pay off debts if in the middle of the contract you become defaulter for more than 90 days, your lender can take the good (vehicle or property) and put it up for auction. Review your financial situation calmly, intelligently analyzing which alternative is most appropriate for the time you live.