In the middle of the crisis, there is only one specialized entity to consolidate loans
- In the last stage, only Celeris and Banco Primus were left.
- A few days ago Celeris has informed his agents that he stops accepting debt consolidation operations.
The payday loan consolidation offered by bbb accredited debt relief companies is a type of financial product that consists of grouping into a single loan all the loans that you have.
There is a popular saying that says “the bank leaves money to those who do not need it” Although it is not the solution for all cases of over-indebtedness, it is useful for people who have become indebted with personal loans and cards in a moment punctual, to be able to continue paying the quotas of his mortgage and current expenses (for example when to have remained unemployed), and his economic situation improves (returns to find work).
The first thing is to negotiate the reunification of debts with the entity with which you have the mortgage of the habitual residence. We can extend the current mortgage to include other debts, give us a second mortgage that includes non-mortgage debts or cancels the current mortgage and grant us another that reunites everything (this is the most expensive option).
From four to one entity
If this option does not come to fruition, it is time to go to specialized financial institutions, either directly or through professional mortgage intermediaries. Financial institutions specialized in reunifying debts and loans offer more expensive mortgages, given that the risk of default of this type of clients is higher.
Until a few years ago one could go to a series of specialized financial entities, among which were:
- GE Money Bank (financial of General Electric)
- GMAC (from General Motors)
- Celeris Group (whose partners are savings banks)
- Banco Primus (based in Portugal)
In the last stage, there were only Celeris and Banco Primus. And a few days ago Celeris has informed his agents that he stops accepting debt consolidation operations.
A popular saying that ” the bank leaves money to those who do not need it ” becomes patent. When it is more necessary to have entities that offer debt reunifications, they disappear from the market.
It must be said that Celeris’ latest price rate was so expensive and restrictive that he almost invited not to work with them; to begin with, they only approved operations at 50% appraisal. And as for conditions, for the best client profile (in which they accepted up to 2 unpaid loan installments), the conditions were:
- Euribor + 6.95 (when in a normal mortgage the average would be at a Euribor + 1 or 1.5).
- Opening commission of 3.95% (in a normal mortgage ranges from 0 to 1%).
- 35-year term.
To get an idea of how expensive it was to reunify these prices, apart from taking into account the expenses of setting up the new reunification mortgage, it is enough to compare what gives us a “normal” mortgage and a debt reunification. Let us take an amount of 200,000 euros to 35 years.
The share of a mortgage for purchase-sale (Euribor + 1) would be 781 euros. The share of a reunification of debts with Celeris would have resulted of 1,575 euros.
More than double
A monthly cost difference of 794 euros, more than double. That a year is nothing more and nothing less than 9,528 euros. With these conditions, it was clear that little solution represented for over-indebted families. Hiring a reunification with these conditions was at least a financial suicide.
Just as banks grant mortgages to creditworthy customers, they have to provide mortgage loans to give a second chance to clients who have experienced financial problems beyond their control. Instead, at the time when debt reunification is most needed, entities stop offering this possibility to customers. And we all lose when a family stays on the street has been able to solve their financial situation by reunifying their debts.