A rescheduling is possible with negative private credit in principle. However, it is only effective if the interest rate is lower than in the previous loans or if the monthly installments decrease as a result of a longer maturity and the previous lender has rejected the requested contract amendment.

In calculating the potential interest savings, credit customers should not overlook the prepayment interest due for the early repayment of their previous loan.

The search for a debt rescheduling loan with negative private credit

The classic Swiss loan without private credit is due to the limited loan amount of 3500 or 5000 euros and due to the relatively high interest only conditionally for a debt restructuring. In contrast to an official loan remittance, the assignment takes place without specifying the intended purpose so that the bank transfers the loan amount directly to the borrower’s account.

Usually the borrower in a rescheduling with negative private credit to the bank, that he uses the money to replace existing loans. The financial institution transfers the individual installments directly to the existing loan accounts so that the old loans are settled. The customer’s checking account only receives the amount determined for the repayment of the disposition credit and any credit increase.

Many financial institutions require the inclusion of all current liabilities in the case of a loan for a rescheduling with negative private credit. Exceptions generally apply to real estate loans, whose early repayment is not always possible anyway, and often for loans with special conditions such as a car loan or an interest-free partial payment in retail or mail order. If credit customers with weak private credit do not want to include all existing loans in the rescheduling, they make sure in their credit comparison, which bank allows a partial debt.

Some financial institutions and credit intermediaries have specialized in rescheduling negative private credit. Those who use their offers will receive a much higher number of new loans than consumers who are looking for a new loan on their own with poor credit ratings. Before concluding the contract, borrowers must check whether the debt restructuring specialists are actually making the cheapest loan agreement.

The appointment of a credit broker for the search for a loan for debt restructuring with negative private credit offers itself. The skilled person, because of his experience and knowledge of the market, often lends even in extremely difficult cases. A basic requirement for the employment of a service provider is that the latter only calculates a success commission of a reasonable amount and in no case pre-cost. The new loan is often from a foreign bank. If the head office is located outside the euro area and also not in Switzerland, the loan is used as a foreign currency loan. Thus, the monthly rate rises or falls as well as the total amount of the loan repayment when the exchange rate changes.

The chances of a rescheduling by a domestic bank increase with negative private credit if the borrower provides a guarantor. As an alternative even preferred by many banks, a second applicant is conceivable. The guarantor or the co-applicant must have a regular income and a private credit information without negative entry.

What conditions should the new loan meet?

It goes without saying that the rescheduling with negative private credit should lead to the lowest possible interest charge. The effective annual interest rate includes all costs associated with the lending and thus represents the central feature of a credit comparison.

In addition to a favorable interest rate, flexible repayment terms are desirable in the case of loan repayment with a negative private credit. Allowing them to pause once a year, or at least every two years, facilitates proper loan repayment on unexpected expenses. The right to an early repayment without prepayment interest calculation allows for a rescheduling if lending rates continue to fall.

The monthly installment payable for rescheduling must be affordable from current income. A renewed borrowing or even the availment of possibly still in spite of the negative private credit existing disposition credit just for loan repayment leads easily to a renewed strong debt and should be avoided. For this reason, offers a debt restructuring with negative private credit information as long as possible contract period.

The personal loan for the debt restructuring with negative credit rating

Alternatively to a bank loan, the rescheduling with negative private credit can be made via an organized personal loan. In this case, a guarantor is only necessary for a hard negative feature or for several soft negative entries.

The members of the private lending platforms as lenders pay great attention in their decisions to social criteria and the need for lending. Consequently, they draw a request for a loan remission to interest savings much more hesitant than that of bank customers who can no longer bear the current rates and therefore reliant on a new loan with extended maturity.

In part, the platform operators allow the content of private credit information to be hidden from the lenders. However, experience has shown that dealing openly with negative credit ratings rather than concealing a bad private credit leads to the desired credit pattern, as private lenders reward complete and honest information. In addition, the non-publication of the private credit data inevitably indicates a bad credit rating.

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