Loan Consolidation: Read This Before You Apply!

Loan Consolidation: Read This Before You Apply!

By combining loans, it is often possible to save on your loan costs. Particularly, loan consolidation is helpful if you have borrowed money from multiple locations at high interest rates, and the loans are growing at rates almost faster than they can be repaid. Paying off loans in one place is also much easier. For example, if you have payment problems in a given month, you do not need to negotiate with several MFIs to postpone payment dates or keep your payment months free. Getting a consolidation loan can be very successful even if you do not have to put anything in place as collateral, as many banks also offer completely unsecured loans.

Unsecured loans from the Bank

Unsecured loans from the Bank

The Bank offers unsecured loans, which can not only be used for various purchases, but also for combining loans. The Bank can get unsecured or flexible credit.

A maximum of USD 20,000 can be obtained from the Bank. So if your loan amount is higher than that, you may want to look into getting a consumer credit. It is possible to withdraw money from a flexible loan whenever it has been repaid. Flexicurity can thus also be used to help with various unexpected expenses. However, if you suspect that you will be unable to draw down a loan every time it becomes available, another form of loan may be a better option.

The repayment of the flexible loan is always individually agreed with the bank. Usually monthly installments are debited from the customer’s account by direct debit. The flexible loan can be repaid in the form of either installments, equal installments or agreed percentages (2-10% of the credit used). During the year, it is possible to take two free months, which may not be consecutive. The price of a flexible loan consists of the loan reference rate, the client-specific margin, the annual fee and the withdrawal commission. However, no detailed information on interest rates can be obtained without contacting the Bank.

Consumer credit is another of the loans offered by the Bank, which can be obtained without collateral. You can apply for a consumer credit from a bank up to USD 10 million, but of course, especially without collateral, it is hardly possible to get such a loan. If you want more information about how much consumer credit you can get without your own income, you should contact the Bank.

Consumer credit is best suited for short-term cash needs and generally the loan period is also relatively short.

Consumer credit is best suited for short-term cash needs and generally the loan period is also relatively short.

Often, the consumer credit is paid off in about five years. Of course, you can repay the loan even faster if you wish. The interest rate on the consumer credit includes the reference rate of the loan and the customer-specific margin. The Bank will always decide on a customer-specific margin on a case-by-case basis, including the customer’s solvency, collateral and the Bank’s customer relationship. Therefore, without collateral, the interest rate on the loan is likely to be higher than if the client had to provide some kind of collateral.

The consumer credit can be repaid in equal installments, in equal installments or in an annuity. When paying in equal installments, the installment will always remain the same, but the ratio of interest to repayment may vary as interest rates change. In the case of equal repayments, the amount of the repayment remains the same, but the amount of interest added on top of this may vary. In an annuity, the loan period is always the same, even if interest rates change. Nonetheless, the monthly installment does not continuously fluctuate, but remains the same for at least the interest period.

Why should you prefer to combine loans?

Why should you prefer to combine loans?

For example, even if you are already a Bank customer, this does not automatically mean that you may want to borrow a Bank loan. By competing for loan consolidation between different banks, you will ensure that you get the best possible terms and minimum interest on your loan. In addition, bidding for loans through our site is much more convenient and faster than finding the best loan deal yourself. Usually, banks decide the interest rate and loan amount on a case-by-case basis, so you should contact each bank individually to find out where you would get the largest loan at the lowest interest rates. This is very time consuming and you may easily miss a viable option.