There are solutions to reduce the cost of a home loan, it can go through a renegotiation or a buy back mortgage, here is all you need to know.
Reduce the cost of your credit
The cost of a home loan is determined by its rate and duration, which means that the longer the term, the higher the rate and the cost. On the other hand, if the duration is short, the rate will be reduced and the cost too. Rather, repayment interest is used to designate the cost of a credit, it is possible to reduce it by taking advantage of a lower rate, ie a period offering rates lower than that of its loan. current.
The principle is simple: negotiate a better rate for your mortgage and thus reduce the interest to be paid back. To achieve this result, two options are possible, ie the renegotiation of the credit or the repurchase of the mortgage. However, the two operations do not have the same operation or the same impact on the cost of a loan. It is therefore advisable to make simulations for these two financings in order to know which one is the most interesting.
Renegotiate or redeem your home loan?
The renegotiation of the credit is done with the bank that granted the loan, the borrower will simply make a request to his financial advisor to ask him to renegotiate his contract, it is simply to review the conditions the rate, this appeal is interesting when rates are down and there is an opportunity to repay lower interest.
The repurchase of real estate loan is to apply to a competing bank, the bank will simply propose to buy back the current loan to put a new one in place, including the amount of credit bought back but also the costs that it generates, c that is, the application fees and the prepayment fees. In other words, the rate must be even lower than renegotiation to make the case attractive. It is precisely for this reason that it is advisable to use online simulations to compare the two solutions and the resulting propositions.
Simulate and compare real estate buyback offers
To pay less for your home loan, you need a difference of one point between the current rate and the proposed rate. This difference simply makes it possible to absorb the various expenses to be reimbursed and to realize a gain on the interest. Of course, the more this difference will be important and the more interesting the operation will be. However, it is important to remember loan insurance, which can sometimes be expensive.
To obtain a financing estimate but also to have an idea of the rates applied, it is advisable to use a simulated real estate loan buy online, it solicits the various institutions that can respond favorably to the borrower’s request and offer him financing offers. This makes it easier to compare and choose the best offer that will pay less for your credit.