The repurchase of mortgage is an operation supposed to make you benefit from a better rate and therefore allow you to save money. Thus, before starting, it is imperative to properly assess the consequences of this operation. Indeed, the repurchase of credit generates costs. And for it to be profitable, the expected savings must exceed the expenses. It is therefore important to know the cost of buying back a mortgage to properly assess the situation. Here are the main items of expenditure when buying a mortgage.
When buying back a mortgage, you will have your contract bought out by a new organization which will create new debt for you within its establishment, but on more advantageous terms. This therefore implies for the new organization to settle your accounts with the initial bank, which is only possible thanks to an early repayment of the capital remaining due. As a general rule, early repayment gives rise to the payment of compensation, also known as early repayment penalties. They are intended to compensate for the bank's shortfall in interest for the remaining repayment period.
Note that it is possible to negotiate the absence of early repayment indemnities from the conclusion of the first mortgage so as not to incur these expenses during a possible repurchase of credit. If the penalty is applied, its amount must appear in the contract. In general, it corresponds to 6 months of interest or a maximum of 3% of the remaining capital.
The repurchase of credit is similar to the signing of a new mortgage loan contract. Which means you have to put a new warranty in place. Depending on your current warranty, you have two options. If you have secured your loan with a mortgage, it is possible to do the same with your buyout. In this case, there will be costs for releasing and setting up a new mortgage. On the other hand, if you have used a surety company, it is possible to recover part of your contribution to the mutual guarantee fund. Thanks to this sum, you will be able to set up a new guarantee by surety.
The processing of your file and the implementation of the new financing will generate costs. The bank that buys your home loan will therefore charge you a processing fee. To try to reduce costs, you have the option of negotiating them. Indeed, it is not uncommon for the bank to ignore these administrative fees in exchange for the domiciliation of the borrower's bank account.
The ideal for a repurchase of real estate credit is to have the contract repurchased by its own bank. In this way, you will not have to pay the costs of reimbursement, file and guarantee. However, this may be difficult if the bank does not have a particular interest in granting you the buy-back. It is then up to you to provide arguments. For example, you can subscribe to one of the other products that the organization offers. In order not to lose you as a customer, some establishments will still agree to make the purchase.
However, it is important to note that external organizations are likely to offer better redemption conditions. If you find a buyback offer at the lowest rate on the market, you will be able to keep a nice margin of savings despite the various fees you have to pay. In order to be sure to find the best rate for your purchase, do not hesitate to use an online comparator or to call on a broker.
