On-lending of consumer loans. Overdrafting of consumer loans with arrears

In many domestic financial institutions there is a service called "refinancing of consumer loans". This procedure, as a rule, is beneficial to both the client and the bank. After all, it allows the borrower to improve the terms of debt servicing, and the creditor - not to allow the transaction to be overdue. Some banks refinance not only their own transactions, but also their competitors, thus taking away part of the portfolio from them.

Three main reasons for refinancing

This is primarily about large loans, issued for a long period. This is a mortgage and loans secured by motor vehicles. The banks propose lending on consumer lending in cases where there is a high probability that they can become problematic. Then financial organizations make concessions to customers and agree to formalize a new deal with a reduction in the rate (if possible) or an extension of the term.

If we consider the situation from the point of view of the client, then he should think about refinancing, when, after a while it turned out that the loan was not issued on the most favorable terms. Having paid part of its debt and having proved its solvency in practice, the borrower has the right to expect a certain loyalty.

The second reason why you can use the service "on-lending to consumer loans" is too big a payment. Unfortunately, sometimes the client simply does not count his forces, or circumstances change over time, not for the better. And it turns out that the conditions seem to be good, but credit is so much a burden to a person that he copes with it literally from the last forces. Then it makes sense to renegotiate the transaction for a longer period or change the payment schedule, so that they are able to the borrower.

The third reason is the desire to change the creditor. If the client is served in another bank, receives wages there, uses other services, then, it is possible that he will be offered there and re-crediting consumer loans. Naturally, the terms of the new contract should not be worse than the previous one, otherwise the procedure will lose its meaning.

In which banks is this service available?

Refinancing of "foreign" loans are engaged in many banks. First of all, this applies to large system institutions, such as Sberbank. Over-lending to consumer loans is offered to both its customers on the verge of solvency and to external borrowers. The latter can issue a transaction only if there is no delay in the current one.

In VTB Bank, on-lending to consumer credit is also possible. Here, as in Sberbank, they are happy to give money for the client to close the "alien" deal at the expense of them.

Leaders in the field of refinancing

In addition to the above-listed financial institutions, publicly offers to borrowers other than foreigners to apply for refinancing of consumer loans "Alfa-Bank". The institution positions itself as a leader in this direction of active operations and provides an opportunity for the population to get rid of transactions that are executed on unfavorable terms by issuing new ones. If you believe advertising, this institution is ready to refinance literally any debt, from installments to mortgages. But in reality, it is mainly a matter of fairly large consumer loans. Leading, as always, mortgages and other types of long-term collateralized loans.

Terms of Service

They, as a rule, correspond to those in force for similar products at the time of the transaction. So, for example, in Sberbank, mortgage loans are offered for a period of up to 20 years. The situation is similar in VTB and Alfa-Bank. The interest rate on the new transaction will depend on the amount, as well as on the relationship with the client. So, Sberbank offers preferential refinancing terms for employees of enterprises serviced here on salary projects. On average, it is from 14 to 16 per annum in national currency.

In VTB, interest rates are slightly higher (from 17 a year), but the process of reconciliation and clearance is faster. All records beat the leader in this direction - Alfa-Bank. He proposes to reissue the mortgage at only 12.2 per annum.

How is lending for consumer loans going on?

If a person has firmly decided to refinance his debt, the first thing he needs to do is apply with an application to the institution where he plans to issue a new deal. As a rule, they provide a certificate of wages (for six months or a year, depending on the requirements of the bank) and a passport. Sometimes future creditors ask for a document on the balance of the debt and the quality of the service deal. Some of them independently request this information from the credit history bureau.

At the next stage, the bank coordinates the client with a new loan for repayment of the current one and reports its decision. In the case where it is positive, the borrower informs about the forthcoming transaction of his bank (without his consent refinancing is not possible) and signs contracts.

Documents drawn up in the process of on-lending

In addition to the application form, which the client submits at the approval stage, a credit agreement is necessarily concluded. Unlike ordinary transactions, the purpose of issuing funds will be repayment of a loan in another bank. At the request of the creditor, an insurance contract may be additionally drawn up . This applies only when the transaction is secured by a mortgage (real estate, car or other).

Some creditors do not require insurance of collateral, which significantly reduces the cost of the procedure, especially when it comes to car loans. When refinancing a transaction secured by real estate, you will have to renew the mortgage contract. Usually, this is associated with additional costs, since it is notarized.

Overdrafting of consumer loans with arrears

If the transaction is serviced in accordance with the terms of the contract, it will not be difficult to refinance it. Otherwise, things are going on for loans with broken obligations. If the borrower has admitted a delay in one bank, then he will have to exert maximum efforts to prove his solvency to another.

So, on-lending to an overdue deal is unlikely (unless within the framework of a restructuring within the same financial institution). The bank is interested in the quality of its loan portfolio. Therefore, it can meet the client and draw up a new deal for him to pay off the existing overdue debt, but on condition that he is convinced of his solvency. So on-lending to a problem loan is possible in principle, but on certain conditions (for example, making several "control payments" for an existing transaction).

What should be paid attention to the borrower?

Having made a decision on the need for on-lending, before proceeding to the direct registration, you should read the current agreement once again. If, under its terms, the borrower in the early repayment must pay a serious penalty to the bank, then you can immediately forget about refinancing. After having issued a new transaction, the client will be compelled to pay in full on the current one. And this will significantly increase the amount of debt, so the benefits will be very doubtful.

Among other things, it is necessary to carefully read the new treaty, so that its conditions are not more enslaving. If, after careful analysis, the client understands that it is profitable for him, you need to immediately move from thoughts to actions.