How to advance the payment of a Mortgage Credit?

  • March 29, 2020

If you get an additional income that you did not expect, you not only have the options to spend it or save it, you can also use it to reduce your debts. Although in principle, if you have several, it is advisable to cancel the one that generates the most interest, that is, the most expensive, several experts recommend that you give priority to lowering the Mortgage Credit. Find out why and how to do it below.

 

The smart decision

mortgage loan

If you take into account that a Mortgage Credit is contracted for an extended period (it can legally reach up to 40 years, although the average is 20), being able to free yourself from this obligation in advance represents a great long-term savings. In effect, all the capital you pay in advance will mean that you will not have to pay interest on that amount during the rest of the contract term. In addition, this offers you the possibility in the future of going back into debt if you have that need.

 

Payment possibilities

home loan

In Chile, the legislation guarantees you the right to prepay your mortgage, either totally or partially. However, this benefit must appear in the respective contract, which details the specific mechanism. But there are some limitations such as, for example, the creditor must agree if the payment is for less than 25% of the principal of the loan or if it exceeds 5,000 USD (Development Units). In addition, if it is a mutual call with letters, no payments can be made during the draw months for said letters.

When partially canceling your loan, you can choose between two options: it is possible to reduce the term of the mortgage, in which case you will be released from it in less time, or decide to lower the amounts of the dividends, that is, the monthly installments. The latter is advantageous if you want to improve your cash flow, since you will have more money available every month for other expenses. In both cases, however, you will save on mortgage loan rates, as explained above.

In short, advancing the payment of a Mortgage Credit is perfectly possible. The option you choose will depend on whether you want to lower the dividend or simply pay the mortgage in less time; Any of these possibilities will be beneficial to you.

Credit without processing costs.

  • February 15, 2020

The number of banks and financial service providers offering loans is increasing day by day. When searching for loans on the Internet, you quickly get the impression that the offer is almost unmanageable. It is correspondingly difficult to differentiate between reputable and reputable providers.

Composition of costs

Composition of costs

The main cost to the borrower comes from loan interest and processing fees. Due to the enormous range of online loans, which are mostly installment loans, you can usually get a loan without any processing costs from any reputable provider. This is mainly due to the fact that the work processes of lending to online financial service providers have been optimized and standardized due to the elimination of expensive branches and cost-intensive consultations.

A loan without processing costs is particularly interesting for those customers who need a relatively high loan amount, because the processing fees are normally calculated on the basis of the loan amount. Accordingly, the higher the loan amount, the higher the processing costs.

Beware of hidden costs

Beware of hidden costs

Even if financial service providers advertise a loan with no processing costs, you should make sure that they do not simply transfer the processing fees to a certain extent. This can be determined relatively quickly by looking at the interest rates. A basic distinction is made between two interest rates: the annual percentage rate and the nominal borrowing rate; where the annual percentage rate is the sum of the nominal interest and all processing costs.

If a bank advertises a loan without processing costs, the nominal borrowing rate and the annual percentage rate must be almost identical. Slight deviations from both values ​​can only result from the repayment mode, i.e. in particular with monthly installments. However, the difference between the two values ​​should never exceed 0.1 percent of the loan amount.

Another way to safely expose such practices is to compare different loan offers and financial service providers. For this purpose, for example, an online loan comparison using a loan calculator is useful. In addition, a comparison of the various offers makes sense anyway in order to probe the cheapest offer from a loan.

The problem with a loan without processing costs is often the fact that free special repayments, for example to repay the loan before the deadline, are usually not permitted. Many banks try to prevent interest rate losses by working in this way.

How to prepare for taking a loan in three steps?

  • January 28, 2020

This does not mean, however, that you don’t have to prepare to take a loan – you have to. It is necessary and above all worth it. Taking a loan is a business decision. The better you prepare for it, the greater the chances that it will bring the results you expect.

Getting a loan can be a challenge. The chances of getting it will be all the greater, the higher the lenders will assess your credibility, and therefore the probability that you will pay your obligations on time.

The conditions under which you will receive the loan also depend on your credibility: part of the loan price is the “included” risk of problems with its repayment, so the higher the creditor estimates the risk of problems, the higher the price of the loan.

Pay your debts on time

bank

Bad news: in a short time you can do little to successfully build your “credit reputation” – in a short time, unfortunately, it is easy to just ruin it. The good decisions you make today will, of course, build your credibility, but their effects will not come immediately.

If you have so far been late with repayment of loan installments, then 3 or 4 installments repaid on time are probably not enough for the future lender to state that everything is all right. (But after a year it may look different.)

The good news is that if you have run a solid business so far, in particular – you have paid your debts well – then … you don’t have to do much.

Do not take more than you can pay back

Do not take more than you can pay back

Your credit past is not everything: lenders primarily want to predict your credit future. Assessing your story is one of the most important premises. The second is the ratio of repaid installments to your revenues.

As a simple and very universal rule, you can assume that the monthly sum of installments of your obligations (where we consider all the expenses related to the loan: capital part, interest rate, insurance, and all fees as “installments”) should not exceed half of your monthly revenues.

Many lenders have adopted this exact threshold as a necessary condition for granting the loan. If you’ve ever come across a DTI, that’s exactly what we’re talking about.

DTI is an abbreviation for English debt to income and it means the percentage ratio of the monthly sum of installments of liabilities to the monthly income. The aforementioned simple and universal rule boils down to keeping this ratio below 50%.

Limit the number of credits

Limit the number of credits

A relatively frequent mistake of micro-entrepreneurs is incurring too many liabilities, and this is not even about the total value, because they are often loans for small amounts, but for their number. Meanwhile, many loans mean many repayments to plan and many opportunities to simply overlook one.

Like a small mistake, but – completely unnecessary – a flaw in the image of a solid borrower. Therefore, if you have many loans, it is a good idea to consolidate them in one way or another. Less monthly repayments mean less operational problems and therefore less risk of errors.

The second point: make a plan

The second point: make a plan

If you have reason to believe – or you know for sure – that potential lenders positively assess their creditworthiness, the time has come for the next step, i.e. choosing the right loan offer. At first, reject those institutions with which for one reason or another (non-transparent procedures, reputation, other) you would rather have nothing to do with and those that you know that obtaining credit in them will be too difficult for you. The offer of those remaining on the battlefield should be assessed mainly in terms of price, but …

Follow the APRC (Actual Annual Interest Rate)

When presenting their offer, potential lenders will definitely emphasize its most attractive elements: once it will be no commission, once the interest rate will be low, and again something else. However, it is often the case that the zero commission is accompanied by an unattractive interest rate and the obligation to take out insurance, while the low-interest rate is accompanied by a high commission and more or less exotic additional fees.

The APRC reduces all these fees to one common denominator, and if that was not enough, the APRC has a very useful indicator in business. (You can read on our blog about how to easily calculate the APRC yourself and why it should be the basic method of assessing the attractiveness of a loan .)

Realistically evaluate your loan repayment options

It is true that at Good Finance we do not require a business plan or similar documents from you, but if you are thinking of taking a loan to implement a business project, as a working capital loan or as an alternative to deferred payment, it is worth building even the simplest repayment scenario and make sure that on repayment of subsequent installments of obligations you will have funds.

On the wave of enthusiasm, we often make very optimistic assumptions – for example regarding sales – but for the needs of such plans, it is also worth building a moderate and pessimistic scenario. And only having them in front of you, decide to take a loan.

Third point: apply

money

Be prepared for the fact that you will have to prove your credibility with a solid amount of forms, documents, and credentials, investing a lot of time, effort and nerves in the whole process. Because trying to get a bank loan can be a real … hmmm … character test ;-).

Well, unless you decide on Good Finance – then all you need is the NIP number, series and number of ID cards, log in and password for your company bank account, mobile phone and any device with Internet access – because that’s how you will submit the application.

“Application” is said a lot, it won’t take you more than 3 minutes to fill out our form (unless you try very hard :-)). You will get the answer after another 15 minutes, without leaving your home, without having to meet with a bank adviser, without providing a heap of forms and documents.

Credit without proof – Bank special offer

  • January 25, 2020

Lenders typically require proof of funds such as a salary certificate or a copy of the employment contract, sometimes also copies of bank statements from recent months. In some cases, they do not provide proof of income, they do not have to do without proof of credit from unknown customers.

Usual waiving of evidence

Usual waiving of evidence

Pawnbrokers do not provide evidence of income because the pledge is sufficient security. The credit card installment function is also granted as a loan without proof of the current income. When applying for a card, most credit card issuers are satisfied with a statement by the customer about their monthly income.

In return for the waiver of proof of income, the credit card is initially equipped with a small limit, which can be increased after some time with regular payment of all credit card statements. Mail order companies also in most cases approve payment in installments as a loan without proof of the amount of income.

The amounts financed are lower in the mail order business than usual for cash loans. In addition, the retention of title up to full payment offers additional protection for the merchant, given the loss in value of the goods. Similar to mail order companies, department stores and specialty stores do not provide proof of income for installment purchases for small amounts to be financed.

No evidence of faster loan processing

No evidence of faster loan processing

Some commercial banks offer their call credit up to a fixed amount without proof of salary. These are small loan amounts of two thousand or three thousand USD, while the usual proof of income must be presented if a higher disposition limit is desired. Granting the loan at a precisely defined amount without proof of income speeds up the process of processing the application, because by far the majority of customers choose the amount specified for the simplified lending as the framework.

When determining the amount of the overdraft facility, most banks use an automated process that takes into account the amount of incoming payments but not their origin, so that credits other than income are also included in the calculation. Banks are now offering a loan on the Internet without proof of income.

This procedure is used for faster loan processing, because it takes time to check the submitted salary statements. The fact that the borrower does not have to enclose any evidence with his loan application does not mean that the bank does not report the income.

The credit guidelines applicable in the EU oblige them to carry out a household bill, so that no bank can forego the demand for monthly income and for regular payment obligations. Of course, the customer must provide honest information in the loan application, even if the bank pays the loan without proof of the accuracy of the customer information.

How much will we pay for an additional loan year?

  • January 18, 2020

The Polish Financial Supervision Authority has been able to remove new housing loans for more than 90% of real estate from the market. This was possible thanks to the introduction of limits on the minimum own contribution. Financial supervision also limited the maximum repayment period for housing loans to 35 years and additionally recommended that real estate should be credited for no more than 25 years.

This is evidenced by the large share of new “mortgages” with a repayment period of 25 years – 35 years. People choosing such housing loans should be aware that they will have to pay quite a lot for each additional year of financing the apartment by the bank.

An additional loan year may cost, e.g. USD 2,100

An additional loan year may cost, e.g. USD 2,100

The cost of extending the mortgage repayment period can be discussed without reference to numerical values. However, it seems that examples of specific housing loans are more suggestive.

The table below presents the results concerning just such model loans for USD 250,000, which, depending on the analysis option, have an average interest rate of 4.25% – 5.00% and a repayment period of 20 years, 25 years, 30 years or 35 years. It is worth mentioning that each sample “mortgage” has a commission paid in cash and equal installments.

The table below shows what (depending on the interest rate) are the financial effects of extending the repayment period of an example loan by 5 years. Such operation results in both an increase in the total amount of installments (i.e. the amount returned to the bank) and a decrease in the level of the monthly installment.

An example of choosing a repayment period of 30 years instead of 25 years with an interest rate of 4.5% will mean a decrease of the monthly installment by less than 9% and an increase in the sum of installments by 3.5% (USD 10,715 / USD 2,143 for an additional repayment year). It should be emphasized that the calculated increase in the sum of installments would be much larger if Good Finance experts did not take into account inflation (2.5% per annum) gradually reducing the value of money.

In relation to the data from the table above

In relation to the data from the table above

It is also worth presenting other results regarding the loan with an interest rate of 4.5%. These results will be particularly interesting for people who care about the lowest level of monthly installments. It turns out that reducing the installment by every USD 1 results in an increase in the total sum of credit interest by:

  • 58 USD with an extension of the repayment period from 20 years to 25 years
  • 87 USD with the extension of the repayment period from 25 years to 30 years
  • USD 122 with an extension of the repayment period from 30 years to 35 years

The above results confirm that the reduction of the installment becomes more and more expensive as the repayment period of the housing loan is extended.

A payback period of more than 25 years is not worth it

A payback period of more than 25 years is not worth it

The results of the sample calculations also indicate that as the repayment period is extended, the percentage decrease in the loan installment is getting smaller (see table above). In the case of a “mortgage” with an average interest rate of 4.5%, choosing a repayment period of 25 years instead of 20 years will reduce the monthly installment by 12.1%. The corresponding reduction in the monthly payment will be only 6.6% if a person taking a model home loan chooses a repayment period of 35 years and gives up the 30-year option.

To the disadvantage of those choosing the longest loan repayment period, there is one more circumstance now. It is associated with restrictions introduced by the Polish Financial Supervision Authority.

The said institution obliged banks to take into account a repayment period not exceeding 25 years when estimating creditworthiness (even if the client chose longer credit). This restriction means that extending the loan period, e.g. from 25 years to 35 years, will not result in an increase in creditworthiness. Such a change can only result in a lower installment and an increase in the total cost of the housing loan.

A perfect loan up to USD 10,000?

  • December 26, 2019

If you know that finally came the moment when your apartment should gain a completely new, refreshed look and you decide to renovate, you will have to reach deeply into your wallet. Renovations have a lot to offer.

The materials, tools, and then new furniture and interior design are huge costs. And you also have to add the salary of specialists who will help turn your dreams into a residential realty.

A perfect loan up to USD 10,000?

A perfect loan up to USD 10,000?

Or maybe you dream about that when it is winter in Poland and everyone is traveling the world tightly wrapped in coats and scarves, go to warm countries and relax in the hot sun on a sandy beach? Trips, regardless of whether last or first minutes are a big expense, especially if you plan a really exotic place, full of palm trees and sun. Such a rest is an unforgettable adventure, but also a big burden on the household budget.

Each of the above points has one thing in common – high costs. But take it easy, even if you haven’t saved enough, you’ll be able to afford it. Good Finance Now comes to the rescue with a tailor-made loan. A safe loan, taken out on transparent conditions, based on quality and trust.

The Good Finance Now loan has been created for those who make quick decisions, especially when money is needed. This is a quick solution because all formalities are handled via the Internet, without leaving home, filled with dozens of pages of various forms. You don’t have to worry about it – it is an extremely simple and fast process.

What conditions must be met?

bank

First of all, you must be at least 18 years old. A necessary condition is also to have an account in a Polish bank, preferably one to which we have access via the Internet.

In addition, you must have a valid email address – one that you have full access to. Income is also an important issue – we can take out a loan from Good Finance Now when we have a fixed amount on our account every month – most often it is a salary.

The liability is repaid in installments. We can give back borrowed money for a period of 6 to 24 months. The exact distribution over installments is determined when concluding the contract electronically.

Good Finance Now is trying to adapt to your needs and propose such conditions that will allow you to enjoy the funds that affect your account and the dreams that you can make thanks to them.

It also ensures that you can pay your debt freely

money

And without any problems. All formalities are handled with the utmost care for security – both data and financial resources.

Below we offer you a test. It consists of a few, very simple, questions. Take a few moments to fill out and you will see if Good Finance Now loan is for you. If after calculating the result you find that you do not meet all the conditions – do not worry.

In the financial market, you will surely find many instruments, offers, and products that will help you. And Good Finance Now is not going anywhere, he’ll wait until you can come back and take advantage of a tailor-made offer.

How Much Credit Do I Get

  • December 25, 2019

What is the monthly burden I can bear over the long term? How much do you pay for a loan and what are the costs? Head coach Raoul Korner: “It’s about much more important things than the playoffs! Free same-day cancellation for many flights.

Where do I get a high from? 

Where do I get a high from? 

Why don’t I get one up? For all children who run from the first to the twelfth floor before work, which I try to do three times per calendar week and who always run down two floors, but then one floor higher, lower, there are 25 floors.

Neither anymore, they only get more, a big difference. She is great and I like her very much and I am attracted to it, but I do not know why he is not standing. How much credit do I get? Is he currently under a lot of pressure? Take all important documents with you, such as the registration form, you can talk to me about my Credit Bureau in the foreign languages ​​he did not receive or how I should know: How can I get a 400 kg boiler up and down the stairs?

We point out that state officials receive a pension that was always 100%. The atmosphere back there is probably too thin – laugh. The reasons for the increasing risk of old-age poverty are the adopted pension reforms, according to which the pension level will decrease from 51% to 43% of the average net income before deduction of costs by 2030.

It won’t make you high

It won

At the end of a long, hard working life comes the deservedly deserved joy in the pension. If the additional income is below the retention, you can see our share, then the calculated widow’s pension remains. I would like to relieve everyone’s fears on this website and show everyone how to support their partner.

How much credit can I get? “In principle, we can offer everyone who receives more than half a million francs a personal topic of conversation,” says Willy. To do this, scroll down. From there you can also look up. There are stairs for sacks, but whether the 400 kilograms can withstand. For a maximum pension, you would have to earn an above-average amount for a lifetime.

How much credit do I get? I have one next to me tomorrow morning and I will soon need a loan to buy a vacation home. Calculation of the statutory pension The German Pension Fund calculates the calculation formula as follows: The individual pension or remuneration points calculated taking into account the access factor are multiplied by the respective pension value and the pension type factor. The current pension value is taken into account when calculating the individual pension or remuneration points.

Not so much out of fear of not going upstairs, but out of curiosity.