Loan debt: what to do? A loan to repay other loans

The rapid growth of the credit market means that people get used to living above their means. The real opportunity to instantly use something that isn’t quite affordable and force many to take out loans for huge sums without thinking that sooner or later the money will have to be given.

Often a sudden departure, illness or just irresponsibility prevents the borrower from meeting his loan obligations on time. But such forgetfulness is easy to “treat”. If you pay an impressive late payment penalty a few times, you will most likely establish your financial discipline.

However, it is often much more complicated. With the economic crisis, more and more people are losing their solvency. Whether this is due to job loss or other reasons is not so important.

Loan debt. What to do? Crisis in life and in the wallet

Loan debt. What to do? Crisis in life and in the wallet

Have you read a loan agreement? You will surely find something there that will definitely require you to tell the bank about changes in your life, be it a change of address, place of work or last name. It particularly affects your solvency. The first thing you have to do is go to the bank.

It is better to do this two or three weeks before the expected debt. Try to negotiate a deferral or change in the payment schedule. This way, you can show the bank that you are also worried about credit debt and find out how to fix the least loss situation for yourself.

Remember that all negotiations with the bank must only be done in writing. You can then prove that you really contacted the institution to solve the problem with the world. In any case, please enclose the documents with the application showing that the reason for which you applied to the bank is indeed valid.

This can be a certificate from the employer stating that your salary has been reduced, a copy of the employment file with a dismissal log, a certificate from the employment office, an extract from the honey. Cards with diagnoses and checks for expensive procedures or medication. Bank employees check and make the appropriate decision.

If you are unable to visit the financial institution in person, send the documents by letter, only by registered mail and with a receipt.

What is the delay?


It can be said that up to a point the bank will even benefit from the “forgetfulness” of customers since you will have to pay a fine for each day the loan is delayed. The amount of the penalty can be 0.01 to 3% per day or it can be expressed in a fixed amount.

There are cases where the bank not only charges interest on the loan itself but also on fines and penalties that were not paid on time. Then the debt increases almost exponentially every day.

In addition, almost every loan agreement contains a clause that allows the bank to unilaterally request the early repayment of the loan for breach of the terms of the contract. Delay in payment is such a violation.

Is it worth hiding?


So you have loan debt. What to do? There are many ways to solve the problem, but what definitely does not need to be done is to hide your financial difficulties from the bank. Do not think that they will forget you and the debt will be canceled. If a financial institution employee doesn’t bother you with calls and letters, the reasons may be different, but forgetfulness is definitely not one of them.

Some banks simply don’t have that many people to respond quickly to the slightest delay, and for some structures, it’s sort of a business, an additional source of income. Because the longer you don’t pay, the more you can ultimately ask for, especially if you have taken out a loan secured by a property.

After you have delayed multiple payments, the bank will blacklist you and your credit history will be damaged. Even if you choose to repay an existing loan, you will have problems getting a new loan.

And if the amount of the loan debt exceeds 1.5 million dollars, the bank can request that you be recognized as a malicious non-payer. In this case, you not only face huge fines, but also a real prison sentence of up to two years.

Let’s make an agreement! restructuring

Accumulated loan debt? First of all, ask the bank employees about the possibility of restructuring. In 90% of cases, they make concessions to their customers who are in a difficult situation.

This is because, by law, a bank has to create a fund out of its own profit that covers outstanding loans. This means that the institute’s net profit decreases and not its assets. Therefore, every bank is keen to make such a fund much less because money should work.

The first thing to do is to write a statement on debt restructuring. After review, the bank will decide what to do next. The best solution for you is to sign a new agreement (or an additional agreement to an existing one) over a longer period while reducing the monthly repayment.

Sometimes, especially if you can prove the jar that your difficulties are temporary, you can be given a vacation credit. This means that the repayment of the principal debt of the loan is suspended and only interest remains to be paid. In this case, fines and penalties are also not charged. Banks can offer this service to borrowers for a period of one week to a few months. If your financial situation does not improve during this time, you have to look for another way out.

Another loan? refinancing

If you have nothing to do with debt restructuring, and it turned out for some reason, the bank declined you, you can try another option – a loan to repay other loans. You can apply for a loan from the same institution or contact another one of your choices.

Such a service can be relevant for mortgages, for example, or if you have multiple loans. In this situation, a loan to repay other loans helps to avoid confusion with payments to different banks.

Eventually, the due dates may not coincide and the risk of an overdue next payment increases many times over. It may be advisable to take out a new loan in an amount sufficient to fully repay all other loans and to carefully monitor the timely performance of its obligations.

You have loan debt: what to do? Find a reliable guarantor. This is another way to solve the problem that the loan officer can offer you. Until you regroup your money and start fully meeting your obligations, the guarantor will act as the guarantor of your solvency. Of course, you have to prove the guarantor’s solvency, you need a full package of documents, usually the same as for the borrower. However, keep in mind that the guarantor bears all responsibility if you still cannot pay with the bank.

There is a hunt: collectors and anti-collectors

There is a hunt: collectors and anti-collectors

If your debts exceed ten dollars and you’re afraid to speak to bank employees, your debts can be transferred to a debt collection agency. Sometimes such structures completely redeem your debts to the bank through a loan, but most collectors use it to outsource.

This means that they each offer a unique service. Communication with such companies is usually much more unpleasant than talking to bank employees. Although they are required to act within the legal framework, this does not always happen in practice.

By law, the collector must first contact you by phone and try to convince them to voluntarily repay the debt. Next is the mailing list. The collector must inform you in writing that the bank has instructed him to collect the current loan debt from you, the amount of the claim and the repayment period.

If you ignored this call, the debt collection agency staff will try to meet you in person. They can come to your home or work. If no measures have resulted in a positive result, the debt collection agency can file a complaint with the court to enforce the debt collection.

In this case, you can try to use anti-collector services. These are such legal organizations, the essence of which is to protect borrowers from collectors or banks. An anti-collector can also help reduce the amount of the fine and achieve a recount of the credit penalty.

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Alternative to current account credit

We would be happy to make you an offer for a current account credit or inform you about many other options for corporate financing

General information on the current account credit. With a loan, it is usually the case that you get money from the bank into the account and can then use it. However, it is different with some loans: Here, a credit line is granted on the account in order to be able to overdraw the account for a certain amount. The current account credit is an example of this. The current account credit means that a credit line is agreed on the borrower’s account, which the borrower can then use. Overdraft facilities are also known as overdraft facilities.


What is a current account credit?

account credit?

A current account credit basically defines two types of credit lines: overdraft facility and overdraft facility. If you get to the bottom of the name of the current account credit, it means nothing else that a credit is made available on the current account, ie the current account. A current account credit is very flexible when it comes to using it. Many prefer the overdraft facility over other types of credit, because the overdraft facility is not a fixed amount but, as I said, a credit line that has been agreed with the lender. The flexibility of the overdraft facility is in particular that the borrower can decide for himself whether he wants to use the credit line at all and if so how much of it he needs now. For this reason, many opt for a current account credit.


Current account credit: An extremely flexible loan

Current account credit: An extremely flexible loan

However, the flexibility of the overdraft facility has no end here – moreover, that you can decide on the loan amount yourself, the overdraft facility still offers flexibility in terms of time: A overdraft facility usually has no time limit and can be used whenever you want. Private customers always use a current account credit if it is an overdraft facility. As mentioned, the overdraft facility is the other variant of the overdraft facility. However, the overdraft is usually limited in time and the credit line is canceled or reduced after an agreed time. For example, a credit line of several thousand dollars is granted to the borrower over a few months. However, it must be said that the overdraft facility is a very expensive loan, even for business customers.


Current account credit: An extremely expensive loan

Current account credit: An extremely expensive loan

It is not uncommon for a current account credit to pay up to 13 percent interest. If you use the full credit limit for the overdraft facility, you can get a lot of interest here, especially if you take your time to repay the loan. However, the current account credit offers a small advantage over the installment loan. With the current account credit, it is now the case that interest is only incurred for the amount claimed. If you now take out an installment loan of 5000 dollars, but ultimately only need 3000 dollars, you still have to pay interest for the full loan number. Business customers also use the overdraft facility quite often – however, it is usually possible to negotiate individually with the banks regarding the interest rate on the overdraft facility. Ultimately, however,

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Are there interest free loans?

Interest-free loans would be helpful in many types of financing. But be careful, there is more to it than you might think. Interest-free loans almost sounds too good to be true, because it is often the interest that many borrowers struggle to finance. An interest-free loan sounds like a free loan that simply repays what you get. An interest-free loan, many believe, should not be worthwhile for the bank, because it earns money from it. Loan interest is not the only thing that banks use to make their money on loans.


Interest-free loans from branch banks

Interest-free loans from branch banks

You have to say that really interest-free loans are rarely found at branch banks. If, as a borrower, you find such an offer, you have to take a close look and not strike immediately just because you don’t pay interest. The terms and conditions are usually set differently in the loan contract than a cardboard display in the bank would like to make you believe.

It may be that there is no interest on the loan, but there will certainly be other costs for the borrower. Such can then be ancillary credit costs. For example, you then pay commissions or costs for the loan yourself, and credit account maintenance fees may also apply to an interest-free loan. An interest-free loan may only seem like a good bargain at first glance, but the downfall of the ancillary loan costs for an interest-free loan often amounts to a higher amount than you would pay with a normal installment loan.


Interest-free financing when buying a car

Interest-free financing when buying a car

However, there is another way and that with so-called 0% financing. Such are offered for example when buying a car – they also offer various electronics stores. Such financing is even very often offered when buying a car. For interest-free financing, however, it is necessary that you can not show negative Credit Bureau entries and have an unlimited employment contract. But you should also calculate well with the car dealers and their 0% financing. An installment loan may even be cheaper and by paying in cash you can negotiate a discount with the dealer.


Interest-free loans from the state

Interest-free loans from the state

You can only really get interest-free loans from the government and not everyone. Most of the time, the interest-free loans from the state are support programs, as Credit Aid is one for students. In some exceptional cases, the social welfare office also provides interest-free loans. However, such exceptional cases are usually vital circumstances when, for example, people can no longer finance electricity or water themselves. Such loans, of course, also have to be repaid and mostly the social welfare office only extends interest-free loans for a short time.

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Why your credit card PIN is now important

In Germany, you only need the PIN for your credit cards to withdraw money. It changes. In the future, the PIN will also be requested from the cash register. Why this is so and how you can simply remember your PIN.

Whether at the petrol station or in the supermarket – at credit card we have long since got used to having to enter the PIN. Now you also need your PIN when you pay with your credit card at the counter. This applies to all Sparkasse credit cards issued from July 2017. This is intended to provide additional security and prevent credit card misuse.

When traveling abroad you should know your credit card PIN anyway. In Great Britain, France or Switzerland, for example, you have been asked to enter your PIN for a long time.


Easy to remember: the desired PIN

PIN code

You have already received a PIN with your credit card. Is it difficult to remember? You can change it to your individual PIN at any time so that you can memorize the number sequence more easily. This works in a few steps at each of our ATMs.


You don’t know your PIN anymore?

You don

Did you receive a PIN from us a long time ago and you can’t remember it? Then act now. Apply for a new PIN. This also applies if your credit card is due for exchange in a year or two. You have various options for this: 

  • You contact your customer advisor in your branch. There you can apply for a new PIN.
  • You can now apply for the new PIN online in the service center on our website. Prerequisite: Your account is activated for online banking.
  • Have you received mail from us in the past few months informing you about the change in the Sparkassen credit card? Then there was usually an application form for the new PIN. You can use this to order the new PIN by post.

By the way: The PIN does not change when the card is exchanged. The number that you have been using to withdraw money from the ATM remains.

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Early repayment of a loan

Early repayment can be problematic if you don’t know the terms. In the case of real estate in particular, it is common to take out a loan. Because you rarely pay for a house or apartment in cash. The path then goes through the bank, which then grants you a loan to purchase the property. Of course, it would be fatal to get a single offer from a bank. In this respect, it is advisable to compare the different loan offers.


Cancel real estate loans

Cancel real estate loans

Most contracts for the desired loan have a term of 25 to 30 years, with the fixed interest period for real estate loans often ending after 10 years. As soon as this fixed interest period has expired, further financing can be discussed with the bank, or it is also possible to ask other banks which conditions they offer for follow-up financing. As a customer, you have a little longer leverage here because you can still switch to the competition after the fixed interest period. This is a means of pressure for the bank in negotiations on follow-up financing.


Premature termination of the loan

Premature termination of the loan

Of course, it also happens that borrowers want to cancel their real estate loan before the fixed interest period expires. There can be various reasons for this: for example, that the object should now be sold. So then the time would have come to repay the loan. In order to find out exactly to what extent a termination can be asserted and what conditions must be in place for it, the loan agreement made at the conclusion is very helpful. In this loan agreement, the conditions for repaying the loan were specified at the time of the conclusion. So also to what extent it is possible to repay early. As a customer, you can find out whether special repayments are possible free of charge or if it has been determined that early repayment is not possible at all, you have to negotiate with your bank about a transfer or rescheduling. If you would like to repay the loan early, even though this is not provided for in the loan agreement, the bank will most likely request a prepayment penalty. This prepayment penalty is reflected as a fee as compensation for the interest that you no longer pay due to the early repayment.


Follow-up financing as a repayment option

Follow-up financing as a repayment option

However, the previously mentioned follow-up financing can also be a way of early repayment of the real estate loan. However, the bank can also refuse this if the termination only aims to get better terms regarding the interest. If the contract is terminated, the bank will most likely also request a prepayment penalty.

With early repayment, it is always such a thing. Banks don’t like to see this, although of course they get their loan back early, they lose valuable money that they would have earned with the interest. In order to avoid such problems right from the start, a special right of termination should be agreed in the loan agreement.

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Comfortable holidays with a credit card

Credit cards are versatile. Not only do they make shopping easier, they also help with online bookings – for example of hotels and rental cars.

Sometimes it can not be done without: When you book a hotel on the Internet, you often experience that the credit card number must be given – unlike package tours, where the customer usually has the choice between different payment methods. However, it is worth taking a closer look here, because there are two types of bookings: with prepayment or with a credit card guarantee.

When booking with prepayment, the entire amount is due immediately. The alternative with a credit card guarantee is much more attractive: No money is debited when booking. You usually have the choice of paying in cash or with another debit or credit card. In this case, the credit card only serves as insurance for the hotel. The credit card will only be charged if the accommodation is paid in advance and cannot be canceled – or if the cancellation period specified in the booking has been exceeded. There are often deadlines up to which day before arrival what amount is due.

If you pay or guarantee a hotel booking online with a credit card, there are usually no fees. At least with the big providers. For some smaller hotel agents, however, a small processing fee is payable – even if the cancellation is generally free of charge. It is worth taking a look at the booking conditions here.


Car rental bookings by credit card

credit card

If you want to be mobile at your destination and want to explore the surrounding area, you can often book a rental car. Best of all from home, because the booking here is usually in German, so that even complex clauses of the rental agreement are easier to understand. In addition, prices and conditions can be compared in advance in peace. The same applies here: at the major international car rental companies, you usually need your credit card to book the vehicle you want.

This is convenient and, depending on the card model, you may also receive a discount thanks to your credit card. In addition to the rental price, the deposit is also deposited with the credit card without cash. If you also plan to pay by credit card on site, it may be worth talking to the Moneysparks Finance before you travel and getting the credit line temporarily increased.


Check carefully in the event of damage

credit problem

If you are involved in an accident with your rental car or the car is scratched, your credit card may be charged with the cost of the damage. Therefore, check your credit card statement carefully. If there are any inconsistencies, you should first speak to the car rental company. If certain items were incorrectly invoiced, ask your Moneysparks Finance to cancel the card debit.

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Credit card: the all-rounder among payment methods

Credit cards are not only a practical means of payment on vacation, they also make life easier at home. Find out what you can use a credit card for and what types of credit cards are available.


What can you do with a credit card?

credit card?

The little piece of plastic in your wallet is a real all-rounder. You can use it to make cashless payments at millions of acceptance points worldwide and withdraw cash in local currency from ATMs in almost all countries. The credit card is also a common means of payment in most online shops on the Internet.


What types of credit cards are there?

Credit cards are available in different versions. With the basic credit card you load a credit from your checking account onto the card. You can only spend this credit when using the card. You have control over your expenses at all times.
With MasterCard Standard or Visa Card Classic, sales are debited from your checking account once a month. So you remain financially flexible. You will also enjoy other benefits such as the travel emergency service. You can get help around the clock on a telephone hotline – if you lose your card or if you have any medical or legal questions.

The MasterCard Gold or Visa Card Gold also offer you a high-performance insurance package. These include travel health insurance abroad, travel cancellation insurance and a foreign car protection letter.


How does payment work on the Internet?

credit payment work on the Internet?

You can pay safely and conveniently with a credit card in almost all internet shops worldwide. The money will be credited to the dealer immediately. The ordered goods will be with you faster. Many shops ask for the card verification number. You will find this three-digit code on the back of the credit card to the right of the card number.


What to do in the event of loss or theft?

Have the card blocked immediately. To do this, call the nationwide uniform number(free within Germany). This is how we can limit the damage. If you have reported the loss immediately, you are liable for a maximum of 50 dollars. You will receive a replacement card from us within 48 hours.

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Car Loans Or Consumer Loans: Which Is More Profitable?

According to statistics, the average cost of cars in Russia comes to 800 000 dollars. It should be noted that this number may vary by region. In Primary, for example, this amount can reach one and a half million dollars. At first glance it is clear that the average person cannot earn such money for even a year.

As always, credit organizations come to the rescue. The population often asks the question: “Car loan or consumer loan, which is more profitable?”. To focus on a particular type of loan, the positive and negative sides of a car loan and an untied loan need to be identified. 


Auto Loans: Pros and Cons

Auto Loans: Pros and Cons

1. The ability to process a loan from a car dealership. With a small cash payment for the down payment of a loan, you can make an application without leaving the dealer.

2. Comprehensive car loan program. Almost all banks offer credit services for the purchase of the “iron horse”. Due to the fact that the bank automatically protects itself when a loan is applied for it, the decision to approve a loan is far more common than the decision to use a consumer loan.

3. Low interest rate In contrast to consumer loans, where the average interest rate on a loan is 20%, auto loans in this regard at the level of a mortgage – 11-12% per year.

General Motors’ statement earlier this year about the American manufacturer’s exit from the Russian auto industry due to a declining population demand for finished products has allowed developers of other cars to offer lucrative deals to consumers: unprecedented low interest rates on the loan – 5- 6 % lack of them at all.

Although the country’s economic situation wants the best at this time, it is the best way to buy a car. Of course with the question: “Car loan or consumer loan – which is better?”, Undoubtedly, a loan that aims to buy a car benefits in this regard.

4. The inability to sell the car to third parties. For car loans, banks always take your deposit on the car they bought, and the PTS stays in the bank until the day the loan is repaid. If you fail to pay a loan, the bank takes ownership of the vehicle.

But here you can try a trick if you don’t have the financial resources to make a monthly payment and you have “bare pockets” at your disposal. To do this, you have to go to the traffic police, write a statement about the loss of TCP and after a while you get it. Now you can sell the car and pay the loan. But all of these actions are illegal!


Consumer credit: advantages and disadvantages

Consumer credit

  1. Use cash at your own discretion. Due to the non-target loan being issued, the option to buy a used car at a lower cost is shown, unlike a car loan, where funds are only spent on buying new cars, with the rare exception of used cars.
  2. Full disposal of your car. Of course, this is a key asset when designing this type of loan. You can sell, change, pledge your “friend” without breaking the law.
  3. The possibility of refusing a loan. Not all banks are ready to give you their money if there is no deposit or guarantee. Car Loans Or Consumer Loans – Which Is More Profitable? Of course, the target car can be bought from the bank.
  4. Significant interest rates. In practice, the interest rates for consumer loans are always higher than for car loans.


Car loan or consumer loan: reviews

Car loan

According to reviews, the majority of Russian people prefer to take out auto loans. They focus on the fact that this type of lending is easier, without unnecessary “hassle”, and tolerates the fact that TCP remains committed to the bank.

But there are those who strictly defend themselves, guided by the fact that when buying a car with consumer credit, people have the opportunity to use it at their own discretion: sell, change, donate, and so on.


Car loan or consumer loan – which is better? 2014 as an indicator of financial instability

Car loans

The imposition of sanctions, the drop in oil prices, instability in the ruble exchange rate caused. In this regard, the majority of banks across Russia have tightened the conditions for consumer credit purchases, making it practically impossible to maintain a low-income population.

The car loan had practically no effect on it, except for a slight increase in annual interest rates, and the conditions remained unchanged. So car loan or consumer loan – which is more profitable? In 2014 auto loans are primarily available because they are easy to obtain and offer low interest rates.


Reviews on the previous system of Wiser Savings Bank auto loans

car loans

Often did the forums discuss the topic of better car loans or consumer loans at Wiser Savings Bank? The ratings showed that the majority of the population preferred to borrow a car from this bank thanks to an attractive interest rate compared to other financial institutions. However, part of the population is still waiting for the bank’s car loan system to be restored.


What’s even better: car loan or consumer loan?


Answering the question: car loan or consumer loan – which is more profitable? “They offer bonus and special programs for car loans, and in times of crisis it is sometimes possible to take out a car loan without overpaying. Take out a consumer loan to save money on comprehensive insurance.

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