Credit repurchase is a financing solution that offers many advantages that we offer you to share with you. Our guide on buying back credit will help you see more clearly and organize the resumption of your commitments.
Summary
It is sometimes called Credit grouping or even loan restructuring. The main objective of buying back credit is to reduce the total amount of monthly bills. This financial solution involves the repayment of several current loans through a new single financing. This generally allows simplify the management of your receivables and to take a break from paying your credits.
There are several reasons why you might want to consider buying a loan. Based on our experience, here are the most common reasons.
It's simple: a lender buys back all of a person's loans to consolidate them into a single credit as part of a new financing request. A credit repurchase transaction allows one or more loans, leases and credit cards to be paid off at once.
Following the activation of the new contract and the closure of the purchased loans, the borrower will only have one credit to repay and only one monthly payment to pay. Having a single financing contract allows with a single bank interlocutor to facilitate the control and management of your finances.
1. Anticipate the repurchase of your credit and take into account the legal deadline.
The Federal Consumer Credit Act (LCC) defines a legal minimum period of 14 days1 for the activation of a credit during which the borrower can cancel his credit.
This delay is added to the processing time of your new financing request. However, it is possible to avoid this waiting time in the case of financing of an amount greater than CHF 80,000.-
1Article 16 of the Federal Consumer Credit Law
2. Consider repaying all of your commitments
Don't limit yourself to taking back your private credit. All of your credits registered with ZEK can be redeemed simultaneously, in particular your credit cards and leases. A global resumption of your commitments will allow you to optimize your budget and effectively reduce your monthly bills.
Use our Loan calculator to get an initial estimate of your budget. You can then make an online request simply and without obligation. After the bank's agreement within 24 hours, your Credial advisor will present you with the options available to you for repurchasing your loans and the potential for savings on your monthly bills.
3. Buy back your credit and take advantage of a 90-day break for your monthly payments
When you take out a new private loan, you can postpone the start of its repayment for a few weeks. The same principle is therefore applicable for a credit repurchase transaction.
In practice, using a loan consolidation thus offers you up to 90 days of relief for your payments. This is an opportunity to reorganize your finances and free your mind to devote yourself entirely to your projects.
4. Borrow enough to successfully finance your new loan
Underestimating the amount of financing often means having to use your monthly cash flow to cover unexpected expenses. This then leads to reapplying for financing, which will not necessarily be granted, and to devote time to it.
Providing a sufficient funding envelope allows you to deal with these unexpected expenses calmly.
A credit repurchase transaction needs to be anticipated and some recommendations should be considered.
Our first piece of advice is to talk to your financial advisor or broker about it.
Your broker will be in a position to assist you effectively in preparing your file and assess the financial impact of your takeover. So you will be able to know the amount of the balance of your commitments at ZEK and the cash extension available if necessary.
You can also define with him a new monthly payment that is comfortable and that corresponds to your situation.
Here are some key things to consider when it comes to your repurchase transaction.
- Freedom of reimbursement : Any private credit can be repaid in advance. This rule is established in the Consumer Credit Act2
- Interest rate : The consolidation of your credits is an opportunity to take advantage of new, more advantageous interest rate conditions
- Loan term : A longer term can reduce your monthly payments while allowing you to make timely repayments in advance when you can.
2Article 17 of the Federal Consumer Credit Act
Using a credit broker when considering a loan repurchase in Switzerland has several significant advantages:
1. Budgeting & Customized Solutions
The main requirement for taking out a private loan is to create a budget that shows financial organizations that you are in a position to repay the loan. The best brokers are generally budget experts. Having your budget established by a professional will allow you to maximize your chances of obtaining the best financing.
“A budget is about giving directions to your money instead of asking where it went.” - Dave Ramsey
2. Expertise and Personalized Advice
Brokers are experts in the credit market. They offer personalized advice adapted to your unique financial situation, and select for you the lending institutions offering the most appropriate solutions to your situation.
3. Access to exclusive offers
Brokers have the ability to negotiate more favorable terms thanks to their close relationships with banks and financial organizations.
4. Saving Time and Energy
Organizing the repurchase of your credits takes time, because you have to contact the institutions one by one. Your broker will take care of the procedures and represent you by selecting the best options for you.
5. Better Credit Conditions
With their market knowledge and negotiation skills, brokers are often in a position to obtain lower interest rates and better credit terms for their customers.
6. Assistance in the procedures
The credit repurchase process can be complex. A broker guides you through all the steps, from preparing your file to finalizing the repurchase agreement. All aspects of the loan repurchase will be combed through.
7. Responsiveness and Flexibility
Your broker is there for you. He listens, takes into account your requests and can adapt your financing solution as necessary. It thus offers you more flexibility and choice for your credit.
To conclude, let's discuss some frequently asked questions about buying back credit:
Q: How long does the credit repurchase process take?
A: The length of time may vary by institution, but generally, it takes about 3 weeks from application to approval.
Q: How many credits can I buy back?
R:. In practice, all of your commitments to ZEK can generally be redeemed simultaneously, whether they are personal loans, credit cards or leasing.
Q: Are there risks associated with buying back loans?
A: A loan repurchase as part of a new financing does not involve any particular risk, as it is governed by the Consumer Credit Act (LCC). However, it is possible that the credits purchased are not completely redeemed. The support of your Credial advisor includes a systematic check by the ZEK to cancel this risk.
