If we are in need of reducing the monthly payment of our debts, one of the options consists of the renegotiation of the same to pay a single receipt of lesser amount than the total sum of the current installments. The reunification of debts allows individuals, self-employed or companies to reorganize their economy and deal with their debts immediately, but let’s not forget that it is only one of the solutions, and in fact the experts only recommend it as a last option.
Even so, when the need is urgent, and has done so during the crisis, the so-called debt collectors have taken advantage of the desperation of many companies and private customers to offer their services in exchange for substantial commissions. In fact, in recent years there are many who choose this formula either through banks or intermediary companies, which then negotiates with credit institutions to reunify the debts of their customers in order to pay less on a monthly basis.
What is the reunification of debts?
Thus, we can define the reunification of debts, also called unification or consolidation of debts, such as the financial operation through which we obtain a loan to pay other loans or previous credits, grouped in a single monthly payment of smaller amount. Basically, we are unifying all the debts in a single mortgage loans, although there is also the option of doing so without the need for mortgages or guarantees, which represents an important limitation of the amounts of debt admitted. In this way, we obtain a single loan at a lower interest rate, but with a longer repayment term.
Risks of reuniting debts
The consolidation of debts is not the panacea , logically, because although the monthly payment is unique and lower, and the repayment term can be adapted to the needs of the payer, the loans that are about to end will lengthen their term, since they do not We will finish paying them until the new credit ends. Avoiding this type of situation requires knowing the conditions to assess their suitability in light of these, and before making a decision weighing other alternatives. Do not forget that the reunification of debts is just one of the options that exist to face situations of default. Before signing a loan to reunify, it is essential to be alert to a series of risks, such as:
- High Commissions: it is necessary to assess the fees and total costs of processing and formalization, including notary fees, registration, agency and taxes, as well as penalties for early cancellation.
- Higher interest rate and term: it is recommended to compare the interest rates, and be aware of what part of the fee corresponds to the interest, as well as the term of the loan, including the payment of the total expenses of the operation.
- Consultancy expenses: if the bank refuses reunification, private reunifiers will be the only alternative, which implies higher commissions and risks, so it is essential to have expert advice that will increase costs even more