Restructure your debt by transferring your credit to another bank; it is possible. We explain why, how and what to avoid.
A loan repossession. What is it exactly?
Restructuring your loan, consolidating your debts, consolidating your loans, taking over your credit agreement,...
These terms mean the same thing, namely the transfer of one or more credit agreements from one bank to another. It is therefore a change of creditor covering your personal loan.
In principle, this is done for the sake of optimising conditions or, in the case of several contracts, in order to have only one point of contact.
This can be done at any time and you do not have to present any proof to start this process. The procedures are relatively simple and do not require the intervention of a lawyer or notary.
How much does it cost?
Nothing at all.
The Federal Act on Consumer Credit even favours this type of transfer as long as an early payment of the debt is possible. Everything is planned to avoid over-indebtedness, overly attractive promises or financing solutions that are difficult to decipher.
As a result, there are no penalties or processing costs charged by financial institutions. This would be contrary to the ethical principles of the profession.
Why do it?
There are several reasons why you may want to take over your loan. The one most often put forward is the desire to lower your monthly payments. Of course, it is useful to lighten the burden of monthly expenses to free up your cash flow.
As soon as a more attractive trade-in offer in terms of interest rates is proposed, it can indeed make sense.
After all, if there are no costs, why not take advantage of better conditions?
The other main reason given, knowing that credit cards can also be affected by this type of trade-in, is the fact that you have a single intermediary rather than having several contacts with the various banks with which you have taken out private loans. In a way, it simplifies its administrative management. Less time is wasted and you benefit from an individualized service.
To be avoided.
We were talking about a reduction in monthly payments. This can also be achieved by extending the term of your loan. Mathematically, your monthly repayment goes down. However, as long as your interest rate doesn't go down, your total cumulative repayment is likely to be higher.
If your intention is to carry out a transaction that allows you to achieve a better balance for your cash flow, this solution may apply. However, if you want to reduce the total amount of your repayment, of course be vigilant about the interest rate applied without changing the term of the loan.
How to do it?
First, you need to know your remaining debt. This is the amount remaining to be repaid to the financial institution with which you have contracted your loan. All you have to do is ask them for this information.
Next, apply for a loan from the intermediary, financing platform or bank to which you want to transfer your credit. In principle, you will have simulated your loan by carefully looking at the interest offered and the repayment period.
All you have to do is request the official final statement from your bank and prepare the documents to send to your new creditor.
The documents are those usually requested such as identity documents, payslips, rental leases, etc.
And now?
It's up to you. A loan takeover is not done on a whim but in a thoughtful way by gathering all the necessary information to make the best possible decision.
Compare and ask the right questions. If you would like more information or advice or even an offer, make an enquiry on Milenia.ch, the Swiss financing platform.
As with a credit application, it is free of charge, without commitment and the procedures are carried out in complete transparency, in a qualitative and entirely personalized way.
