Who would not like to reduce their level of debt or catch up with payments that we have behind?
I have commented that it is good to know the terms and conditions of our current loans to know what we have contracted and to be able to compare what we have acquired with the current credit market offer. In order to make a fair comparison, it is necessary to know the total annual cost of our credit (CAT), if the interest rate is fixed or if it is variable, in what currency is the credit (pesos, dollars, UDIS, etc.), the remaining term of the credit, and any additional attributes that might be includeds (insurance, for example).
Let’s take an example: let’s say we took out a mortgage loan more than 5 years ago. Interest rates today are at historic lows. So it would be worth seeing if a different credit institution than the one we currently have could offer us better conditions if we take the credit with them. In this case, in addition to making a fair comparison, it must be added that notary fees would have to be added. Even so, it is necessary to see if for the same term the monthly payment to pay is better to see if it is convenient to make said movement.
The same can be done with the balance (debt) on your credit card. You are paying well but you see that another institution has a better rate. Again, you could ask them if it is possible transfer the debt with them and thus pay less interest.
You can also think of consolidate your balances on a single credit card that you currently have, the one that offers the lowest interest rate.
Here it is important to remember that the credit card should be used as a payment method, not as an extension of salary. You also have to take advantage of it to buy for months without interest and pay appropriately to finance those purchases at a zero interest rate; Great!
Or how about analyzing the convenience of requesting a personal or payroll loan that allows you to pay the total of a credit that has a higher rate. Again you would be saving money on interest.
Lowering our level of indebtedness is not a reason to immediately acquire more credit. Let us ask for what we need and what we can afford adequately; This is paying at least the minimum they ask for and doing it on time. This way we will be well with the credit grantor and he will report the timely payment to Credit bureau.
But, suppose that the debt is already significant and we cannot pay it well, interest is being generated for the payment delays and thus also the default is being reflected in the credit history. To do?
The first step would be redo our budget and identify where the money is going to take immediate measures that allow us to get back on track and thus stop paying late interest and other penalties.
In case it is insufficient, you must immediately approach the credit grantor and look for a credit restructuring (change in conditions) that allows us to have a lower monthly payment to continue complying with the payment. As with the previous case, when paying properly again we would be saving the penalties for late payment.
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