Repurchase of your mortgage
When you arrive at the solution of the repurchase of your mortgage by an external bank, it is that the negotiation with your own bank failed, but then you are asked two essential questions:
- Is this the right time to redeem my home loan and in the end would I really be a winner?
- The following few lines and its calculator are there to help you see more clearly in this process. So ready to redeem your home loan?
The question of when should I redeem my home loan is based on the concept of amortization of your loan.
It is often said that the repurchase transaction must be made in the first half of the life of the loan. It is true and that is explained by the fact that a rate change will have much more effect on a still outstanding capital still important (therefore at the beginning of his loan) than on a very small capital (therefore at the end of his loan).
To convince you, do not hesitate to simulate an increase or a decrease in rates on different amounts of principal remaining due thanks to our calculator “calculation of the total cost of your credit”.
We can still explain this fact by the principal repayment system integrated into your monthly payment. Indeed, each month in your loan maturity, you pay interest and repay part of the capital borrowed. This share of interest is more important in the first half of your loan, this is why it is during this period that you must mainly act on the rate or on the partial repayments that you wish to make.
Home loan redeemed
Now, it is a question of answering the second question, how can I be sure that I am really a winner from having my mortgage bought back?
You just have to verify that your new monthly payment is much lower than the old one, by keeping the same remaining term and by integrating the new rate and all the costs in the capital bought back.
This is the whole point of our simulation tool below “calculation of the repurchase of your mortgage” which helps you to estimate the costs related to this operation:
- early redemption indemnity,
- warranty costs,
- booking fees,
- mortgage hands-on fees…
- And to check at a glance if you are interested in having your home loan redeemed. 75,763 Internet users are already using our credit buyback simulator and you?
Once the calculations have been made and the answer is very positive on the interest of taking steps to buy back from the Banks, you have two possibilities:
- Take advantage of these lower rates in terms of comfort, that is to say, reduce your monthly payment and gain purchasing power.
- Optimize your repurchase operation by keeping the same monthly payment, or even increasing it a little if you can afford it in terms of debt, in order to decrease the remaining term and therefore save money in terms of credit cost.