A loan is defined as a contract concluded by a bank with a borrower in the form of a written cash loan and it is the provision of cash for a specified period also covered by the contract. In this case, the lender can be all entities that have the legal capacity and the purpose for which the allocated funds can be allocated does not have to be specified. Among the loans for natural persons, we distinguish home and consumer loan.
A consolidation loan is a kind of combination of these two types, which can be signed in any banking institution offering debt consolidation.
Get your short- term payday consolidation
The payday loan consolidation loan at https://paydayloanconsolidation.net/ enables the combination of many payday loans into one, which will be repaid in installments. The amount of the monthly installment is lower than the sum of installments from previously incurred financial liabilities that will be subject to consolidation. However, unlike a mortgage consolidation loan, they do not require real estate collateral, and its funds do not have to be used to repay this collateral. In addition, the customer can get extra cash and allocate it for any purpose.
Mortgage consolidation loan
The offer of the majority of banks concerns consolidation loans, both mortgage and cash loans. The amount of the mortgage consolidation loan is a certain percentage of the mortgage, which is also collateral for the new financial liability. It usually reaches up to 80% of the property value. When choosing a mortgage consolidation option, it should be remembered that the part of the obtained funds must be repayment of the mortgage, the remaining sum can be used for any purpose.
Examples of banks offering a mortgage consolidation loan:
- Roch Bank – the amount of the loan can reach up to 70% of the value of the real estate, and the repayment of the mortgage loan can be used for a maximum of 30% of the amount of the consolidation loan
- Peraza Bank – the amount of the loan may reach up to 70% of the value of the property (if it is not a security of the loan itself) or up to 60% (if it is a security for the loan), 20% of the loan may be used for any purpose
- Cormack – the loan amount may reach up to 70% of the value of the property constituting its collateral
- Clark- 60% of the loan value must be used to repay the mortgage, 40% can be used for any purpose
- Shelor Bank – at least 50% of the loan value must be allocated to repayment of the mortgage