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The interest rate at the bottom

Now that the Good Finance has reduced the repo rate to zero and the banks have changed their interest rates, we are at extremely low interest rates. In all likelihood, none of us will ever participate in lower interest rates than they currently are.

Sure they can go down with a little more but then we talk very small changes. It is therefore easiest to expect that the current level will be the lowest we will experience. As I write this, a number of lenders have an interest rate on their floating mortgages of 2.15%, which is not much.

Plan properly for the future

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Must say that unfortunately I am a little worried about these low levels as there are very many who do not plan properly for the future. Of course, the Good Finance says that they do not expect to raise the repo rate in the near future, but we are still talking about a relatively short time when it comes to mortgages. The perspective when borrowing cannot just be a few years ahead.

When I lent to my house, the basic tip was to expect at least 6% in interest and to make sure the economy was doing well. This figure I thought was low so I counted 8% instead of being a little safer. These are levels that are almost 3 – 4 times the current interest rate. How many people are now borrowing but not counting in this way at all?

My concern is that many people do not think this way

My concern is that many people do not think this way

At all and thus run the risk of having problems in the future when interest rates go up. For up, it will go with the utmost security. 2 million in loans with 2.15% in interest costs about USD 3,600 a month. An interest rate level of 5% that is fully reasonable and even likely will cost USD 8,300 per month for the same interest rate level. Thus, this is almost USD 5,000 more each month that only has to be paid in interest. Then, of course, there is of course amortization that is the same regardless.

Not many of us would incur an increased cost of USD 5,000 every month without problems. If this increase is not taken into account, the risks are very large for serious problems. Therefore, the tip is to always think about the future when you borrow money.

A negative thing with lower interest rates

A negative thing with lower interest rates

Is that the house price has a tendency to go up as people can borrow more and thus compete more. So this could very well make people borrow even more which only increases the risks.

Although the newspapers now write that the interest rate is very low and you save money on this, you should not be too happy.

Anyone who already owns an accommodation and pays interest on this, while there are no plans at all to move, obviously wins at a lower interest rate. But those who are going to buy a home are not at all clear on that. But the newspapers do not want to put it in their headlines as it does not sell as well.

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Borrow more for energy-saving measures

Borrow more for energy saving measures; only few homeowners do it. Read more about the possibilities for a higher maximum mortgage.

Take sustainability

Take sustainability

The Rutte 3 cabinet has set itself an ambitious sustainability objective in the coalition agreement. To reduce CO2 emissions, the coal-fired power stations will be closed in the long term and the gas connection to new-build homes will disappear.

Homeowners also have to make sustainability a step further

Homeowners also have to make sustainability a step further

According to (Home Affairs) this is not happening enough now. In an answer to parliamentary questions, she mentioned the lack of knowledge among homeowners and mortgage advisers about the financing options as a cause.

For example, in 2017 only 2.1% of NHG mortgages made use of the additional financing options under the guarantee. The Minister is therefore entering into a dialogue with the sector to resolve the bottlenecks.

Borrow more with energy saving measures

Borrow more with energy saving measures

In 2018 you can only borrow 100% of the home value. You must therefore finance a renovation completely out of your own pocket. However, an exception is made for energy saving measures.

  • If you are going to make the home more sustainable, your maximum mortgage will be 106% of the home value.

The maximum mortgage is also higher when buying a sustainable home. Because the energy bill has less pressure on monthly costs, you can borrow more based on your income.

  • With an A ++ or higher you can add up to 9000 euros for your maximum mortgage.
  • If you buy a zero-meter meter, you can borrow up to € 25,000 more.

The above applies to mortgages with and without NHG and is not only interesting when purchasing. Homeowners who want to increase or refinance their existing mortgage with a view to making it more sustainable can also borrow more.

Not a goal but a means

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Ultimately, a higher maximum mortgage is not the goal, but a means. The ultimate goal is to make the existing housing stock more sustainable and a lower energy bill for the individual homeowner.

A goal that we fully support at Dolly Varden. We therefore offer you the option of having an expert calculate the financing options for energy-saving measures without obligation.

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The Credit Registration Office wants to register more types of debt

The Credit Registration Office has been arguing for a long time for a national system for registering all debts. BKR currently only records loans and any backlogs. Mobile phone subscriptions are also registered at BKR in many cases, but due to a conflict with a number of large telecom providers, these are not all registered anymore.

Debt problems

Debt problems

BKR notes that the number of people with debt problems has risen considerably in recent years. Debt problems often get out of hand because people try to resolve existing debts by taking out a loan. In other words, try to fill holes with holes. The result is almost always that people get into trouble so deeply that debt assistance ultimately offers the only way out.

BKR states that it would be better if rental debts and debts were also registered with insurance companies. In this way, debts would come to light sooner. At present, someone with all kinds of payment arrears can still often get a loan, as long as it does not concern arrears on other loans. The moment there is more insight into the total debts and payment arrears of someone, it can be prevented that someone goes further into debt to settle other debts.

Mini-loan is also increasingly causing problems.

Mini-loan is also increasingly causing problems.

Mini loans have been controversial for some time because of the high costs that are charged. In general, it is already financially weaker families who use the mini-loan out of necessity. Often this happens to pay a bill that really can no longer remain. The result is often that the same families have a bigger problem a month later, because the mini loan plus the high costs have to be paid back in one go.

Several large collection agencies indicate that they are increasingly confronted with people who are unable to repay a mini-loan within the stipulated period. This leads to further problems for the people involved, due to the additional costs of the collection agency. These costs are also generally not low.

Filling up one debt with another sooner or later almost always goes wrong. When things go wrong, the problems are often so great that a debt restructuring process is the only option. A debt restructuring process is a very difficult process in which people have to live on an absolute minimum for three years. The advantage is that if everything goes well, after three years someone will be debt-free again, but it is fair to say that by no means all debt restructuring processes are successful.

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Quickly borrow money cheaply and familiarly

Are you looking for a good opportunity to borrow money quickly, but do you first want more information about this subject? Then you’ve come to the right place. It’s not for nothing that we are called borrowing money quickly within 10 minutes, we provide as much information as possible about the cheapest and fastest loans, the lowest interest rates and the best conditions. This way you know for sure that everything will go smoothly for you, so that you will not end up with an overpriced loan, but will always have the cheapest loan at your disposal. Over the course of several years this will often give you hundreds or even thousands of euros in benefits, so it is certainly profitable to see what is the most profitable for you.

To always guarantee that you choose the lowest loan, it is important to view different loans before the decision is made.

Borrow money directly at the lowest costs.

Borrow money directly at the lowest costs.

First check what all the options will be, so that unpleasant surprises do not appear afterwards. The priority when borrowing money is to always look carefully at whether a loan is reliable and affordable. Borrowing money can sometimes entail high costs, while these high costs are not necessary at all. It is always possible to get a cheaper loan than is currently being obtained. Therefore, do not be reluctant to look for another loan, because this can save you as much as possible costs. It can sometimes take a while before the right loan is found, but the process of borrowing money can get so much benefit. Why opt for thousands of euros more on an annual basis when a lot of money can be saved with some effort? Then take your time, because borrowing money will make it a lot cheaper.

Borrow cheap money by comparing.

Borrow cheap money by comparing.

Borrowing money quickly is obviously the most beneficial when it is also cheap. It is easy to borrow because there are many different lenders operating on the market. This means that low interest rates must be applied because there is a struggle to win over customers. As a consumer, this is of course extremely interesting for you, because it means that money can be borrowed from these providers for a low price.

Borrowing money directly can therefore be very cheap if it is handled properly. It is good to get a good overview of everything, which is why we opted for borrowing money quickly within 10 minutes. It is important that consumers have enough information to be able to take out a profitable loan. For example, it is important that the conditions, interest and the term of the loan are properly examined, because this determines how high the costs will be for the loan. So be sure to read well, because this can save you both time and money and time. You don’t want to borrow money now, keeping in mind that in ten years time a lot of money will have to be paid in order to still be able to pay off the loan.

It is of course nice when you can borrow immediately. Normally, the procedures for borrowing money are rather long, because a lot of administrative work has to be done before the loan can be granted. It is therefore not surprising that it can sometimes take a few months before getting real money. However, borrowing money quickly is different. As soon as the request for borrowing money has been placed, the administration will be looked at immediately, and the loan can already be provided within a short time. Before the money can be borrowed quickly, the lender will have to request some information. This is not strange, because it often involves large amounts from lenders.

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Insurance for Housing and Good Tips on Insurance – Payday Loan Consolidation

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There is no doubt a lot of money to save on a well thought out and sensible housing economy.
Before deciding on an insurance policy, you should read the insurance terms carefully. The terms can vary quite a bit from one company to another, and you should make sure that the insurance you take out meets our needs. In general, it is difficult to compare the offers from various for the insurance company. However, there are so many differences in the premiums that you should examine the market carefully before deciding completely.

Two main types of insurance are common in connection with a home.

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The building insurance covers damage to the building itself as a result of fire, water leaks, natural disasters and the like. It is possible to extend this insurance to cover damage such as rot, fungus, pests, etc. Building insurance is always the homeowner’s responsibility.
Home insurance covers damage to movable property such as furniture, clothing, ornaments, electrical items, carpets, curtains and more. The cause of damage can be fire, theft, water leakage, vandalism, etc. A homeowner must pay the home insurance himself unless he rents a furnished apartment.

It is possible to obtain discounts on insurance.

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You can get lower premiums by increasing your deductible. You can get a security discount by installing security locks, fire and burglar alarms o.1. By combining all our insurance policies into one company, you can also obtain various forms of discounts.

Over the past few years, home values ​​have risen a good deal.

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Also, other factors than those shown in the calculations above should be taken into consideration when choosing between renting and renting. If you are expecting a price increase for housing, it may be an advantage to own the property yourself. If, on the other hand, you expect a fall in value, renting may be the best choice. Although history has shown that home values ​​can change a good deal in both directions, the long-term value is probably quite stable. Otherwise, this is a reason why you do not expect loss of value or depreciation in the cost calculation for a homeowner. 

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Study debt at the expense of a house for sale

Because mortgage lenders often still look at the original amount of the study debt, instead of the outstanding amount that has been repaid, study debts still have a major impact on the amount of mortgages. This makes it difficult for starters in the market. This appears from a recently published study by the Intercity Student Consultation (ISO).

The ISO conducted an inventory round among a number of major mortgage lenders. They have taken the calculation tools on the website of the mortgage provider itself as their starting point. “Although the rules have been relaxed since the introduction of the social loan system, there is not enough of this to be seen with these mortgage lenders. Borrowing in the “social” loan system deprives starters of the chance of a home, “said ISO chairman Tom van den Brink.

Substantial differences

Substantial differences

The ISO believes that this is contrary to a motion passed in the Lower House in 2015. With this motion, the minister was called upon to base the calculation of the amount of the mortgage on the current debt. This should be agreed with the Dutch Banking Association (NVB) and the Netherlands Authority for the Financial Markets (AFM).

“With a gross income of 40,000 euros and an average study debt of 21,000 euros, the maximum mortgage that can be taken out is reduced by 42,274 euros (old system) or 25,418 (new system). In many cases, this substantial difference means that starter cannot buy a home, which also causes a congestion in student accommodation. In addition, a study debt may still play a role for decades in taking out a mortgage despite the extra repayment of the debt. A deal is a deal: the norm should be for mortgage lenders to look at the current debt, not the original debt, ”says van den Brink.

No BKR registration

No BKR registration

A study debt at DUO does not concern registration with the Credit Registration Office (BKR). According to the government, this is not necessary because a study debt is of a different nature than a consumer credit. This creates opportunities for concealing the student loan. A study by the BKR has already shown that this occurs, but by no means always consciously. Under the old scheme, approximately 39% of graduates did not give up their study debt when applying for a mortgage.

Own Home Association is of the opinion that the registration of study debts should be registered with the BKR. In this way they want to prevent starters from entering into an excessive financial obligation.

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Reasons why you would not apply to a loan

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Have you already applied for a loan? Well let us tell you that there are two sides of the coin, one can be approved and another can be rejected. We want to help you understand how the credits work, not all the loans requested are approved. This is due to some essential factors that you should consider.

Many people refuse your credit application

Many people refuse your credit application

We know that it is frustrating not to know the real reasons why he is rejected. Normally before it is approved, financial institutions already have their own system and do the pre-analysis. Where customers must fill in the requested forms and gather all the necessary stationery.

First ask yourself these questions:

First ask yourself these questions:

  1. Do you have a credit record?
  2. Do you have a problem with your credit record?
  3. Do you have a guarantee that supports your credit?
  4. Is the information provided real and correct?
  5. Do you have proof of income?
  6. Do you already know which is the best financial institution?

By asking yourself these questions, you will surely know if you can apply for a loan, now we will show you the possible reasons why you could not apply.

Reasons why you would not apply for a loan

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Lack of credit or negative record

Do you have a credit card? If the answer is no, then we recommend that you speak with a financial institution to request a credit card with a low initial amount. That way you can build your credit record and financial support.

Have no guarantees

Not all financial institutions request some type of guarantee, but sometimes they request furniture or security to use it as a guarantee of payment.

Provide false information

This is the worst thing you can do, maybe at some point it is done harmlessly in order for the credit to be approved. But it is not the right way to do it, if you know that you have a problem that can affect your credit application and alter the information accordingly you will have greater problems.

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Mortgage advice in Spain

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In the chapter on mortgage intermediaries that I share with lawyer Cristina Borrallo of the book edited by Bosch ‘ Comments on the Regulatory Law of Real Estate Credit Contracts ‘, collective work coordinated by Dr. José María López Jiménez , openly criticized the myopia of the legislator when regulating mortgage advice.

A book on Law 5/2019, of March 15, regulator of real estate credit contracts that I recommend reading to all mortgaged and potential borrowers who want to know their rights and duties in depth, and professionals who decide to be experts at work Law 5/2019 considers the intermediation service different from that of advice. I do not conceive a quality mortgage intermediation without advice, moreover, a mortgage intermediary that does not advise is more a mortgage comparator than a mortgage professional.

Advice on real estate loans

Advice on real estate loans

Article 19 of Law 5/2019 regulates advice related to real estate loans. The first thing it does is limit the provision of the advisory service to real estate lenders, real estate credit intermediaries or their designated representatives. What is supposed to leave out other professionals, whether lawyers or economists specialized in the mortgage sector. However, the rule adds that these services may be provided by the persons referred to in article 26.3 (persons who offer mortgage counseling “as an accessory within the framework of a professional activity regulated by legal or regulatory provisions that do not exclude the provision of such activities or services, and provided that the credit intermediation activity, without constituting its main activity, is intimately related to the provision of the main contract between the professional and the borrower »), as well as persons who, without being part of the categories already mentioned, they provide advisory services, provided that they have been recognized by the competent authorities and are subject to their supervision in accordance with the requirements established in this Law for real estate credit intermediaries.

Royal Decree 309/2019 limits in this way the independent advice that, in practice, in Spain the possibility of providing independent mortgage advice disappearing in compliance with the legislation, in my opinion. It says that to be before an independent advice the following requirements must be fulfilled.

Who can be a mortgage advisor?

Who can be a mortgage advisor?

Real estate credit counseling is not a free activity. Only complying with the requirements of the regulation can be advised. I agree with Fernando Zunzunegui that real estate agents are allowed to advise, accrediting training and knowledge, in addition to lenders, intermediaries and their designated representatives.

In my view, for now it will not be easy to find an independent mortgage advisor , given the limitations and demands, sometimes absurd, of the Law.

Regulation of mortgage advice

Regulation of mortgage advice

I recommend the article by Dr. Fernando Zunzunegui , friend of the house and also author of the book edited by Bosch commented, regarding the advice on the Real Estate Credit Law ( read PDF ). His vision is that it is positive to regulate the mortgage advice separately, in which I agree, although what Law 5/2019 defines as mortgage advice I consider has no substance to separate it from intermediation. In other words, mortgage counseling is much more than the legal definition of this recent rule.

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Credit card as a way to debt trap – what are its negatives?

In many cases, you will come across a number of advantages and positives. What are you talking about? It’s a credit card that is attracting more and more banks today. If we start with a brief description, it is necessary to state that it is a credit product – not a classic debit card available to a bank account. And because it is a loan, it can itself be a risk. Often, however, larger than a classic loan. Let’s take a look at the negative aspects of a credit card and why it can be seen as a ticket to travel to a debt trap.

Management fees

Management fees

There are few credit cards that do not pay management fees. However, for most market choices, make sure you pay the fee. The most advantageous cards are tens of crowns per month. For others it can be hundreds of crowns. It should be noted that the fee is not related to whether or not you use the card. Even if you only have it in your drawer at home, you need to pay each month.

Speaking of fees, it is a good idea to be aware of the special offers of some banks. They try to give a good impression by giving their credit card product free of charge. In practice, however, this is nothing but their forgiveness for a few months. Then you will pay them again.

Interest rates are high

Interest rates are high

The credit card works very easily. You have an associated bank account with a real zero. With each use of the card you go to minus and thus use the credit line provided. And it is precisely the money spent that pays interest rates. And it doesn’t matter how you use the card. Standard applications include:

  • ATM withdrawal
  • Payment at the merchant – both classic and contactless
  • Online payment when shopping at eshop

Using the given application means that you are drawing a loan. And it is really big interest. When we mention that they are in tens of percent, we are definitely not talking about the least advantageous credit cards. We are talking about what is now considered an absolute standard. Add to this the fee and it is clear that credit card may not be anything convenient.

Minimum installment amount

Loss of overview of finances

Few know this, but the credit card is also associated with the need to think of a minimum installment. And it can often significantly complicate people’s plans. Among other things, because it can lead to various penalties or even cancellation of the card and the necessity to pay the amount spent at the same time, within a few days.

Minimum repayments are quite common for credit cards. They are either set on a flat-rate basis or based on how much money is spent. In practice, this means that if a certain amount is spent during a certain period, at least a minimum amount of money must be sent to the credit card. This is mostly used to cover interest rates. If the limit is drawn, the minimum repayment term is approaching, and the credit card owner has nothing to take from, it can be a combination of very unpleasant situations.

Loss of overview of finances

A credit card can also be a problem product in the sense that it can cause a significant loss of family or personal finances. When we look at classics, people have money:

  • On the bank account
  • At home in cash

In both cases, when paying they clearly see that money is diminishing, so it is necessary to count to keep the money. If a credit card comes into play, people have the impression that they still have enough money, as there are a few thousand left in their accounts and at home. But the cards are taken down and people usually find out from the statement. And in practice, this may mean that their budget has been quite drastically overstretched.

Significant debt

Significant debt

A credit card is a credit product, of course, to obtain income information. While for loans the conditions are quite demanding, for credit cards everything is more benevolent. Not only with regard to the fact that they may have higher approvability. It should also be borne in mind that they also involve the risk of significant indebtedness. If credit cards offered a limit of a few thousand, coupled with the possibility of solving short-term financial problems, there would be nothing wrong with them. However, it is a credit product where credit limits go up to tens of thousands and hundreds of thousands. Anyone who runs out of this amount will only return it very complicated.

Worse repayment

Worse repayment

For classic loans there is a fixed payment schedule. The repayment amount covers not only the interest itself, but also a part of the principal. Thus, the amount of the loan is reduced every month to zero. At the same time, although people can repay less, few do. Most actually pay only what they have to, and use the remaining money exclusively and only for personal consumption.

With credit cards, there are also repayment regulations, but only the minimum. They usually cover the maximum amount of the fee and interest. And since people are basically not obliged to pay more, they only send as much money as they really have to. They have been repaying regularly for several years, no longer using the credit card due to exhaustion, yet they have not yet managed to reduce the value of the spent amount.

Spending on uselessness

Spending on uselessness

When money is not visible – in your wallet or account, people think less about what the money is actually spent on. And so they spend money on useless money with a credit card. For things they would never have bought otherwise. If they have it, why not. If they do not and do not go down, it is a problem not only current, but also a problem that can be described as future. Mainly with reference to the above and that long-term debt risk.

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Bank gives you money tips and advice

The purpose of this site is to provide clear and objective information on the subject of borrowing. First of all we provide an overview of some basic concepts, such as credit, interest, repayment and duration. Then we look at the most common types of loans: collateralized lending, personal loan, revolving credit, standing in red, installment purchase, hire purchase and lease.

Borrowed money, but I cannot pay back!

Unfortunately, people sometimes get into trouble by taking out (too many) loans. We therefore first look at the stages that are followed when debts arise. Then we describe the options for debt mediation and (if things really went wrong) debt restructuring.

We then pay attention to a few lenders where you can go for loans; the BKR or Bureau for Credit Registration in Tiel; the possibility to borrow without BKR testing; and the tax aspects of borrowing.

NB: as stated, the site contains objective information about borrowing; we do not offer loans ourselves. If you want to take out a loan, you can go to all kinds of financial intermediaries, which we show on this site by means of banners. It can be worthwhile to compare the conditions of different providers well!

Borrowing

Borrowing

Borrowing on the basis of collateral is often cheaper than taking out a revolving credit or a personal loan. That has a simple reason. When there is collateral, lenders have more certainty that they will eventually see their money again, and in the financial world it simply applies that the requested reward (interest) is closely related to the risk to be taken

Forms of collateral

There are different types of collateral borrowing. By far the best known and most common is the mortgage; however, this subject is beyond the scope of this site. Other common forms of collateral are life insurance and securities.

Loan of a policy

It is often possible to use a life insurance policy as collateral for a loan (if there is no annuity clause on the insurance and the insurance is not part of a life mortgage). How much you can borrow in such a case depends on the surrender value of the policy.

Securities lending

Those who own shares or bonds will often be able to use them as collateral when taking out a loan. (A special case of this is the securities credit: the securities already held are used as collateral to finance the purchase of new securities.)

Personal loan

Personal loan

The personal loan (also known as PL) is a form of descending (mostly consumer) credit for private individuals that came up at the beginning of the 1960s. Unlike with a revolving credit, with a personal loan the amounts already repaid cannot be withdrawn.

With a personal loan, the borrower borrows a certain amount, at an agreed interest rate that does not change during the term of the loan. A big advantage for the borrower is that he knows exactly where he stands. The repayment of a personal loan takes place in equal (monthly) installments. These consist partly of repayment and partly of interest. The main lenders offering personal loans are the financing companies, followed by the banks. The provision of personal loans in the Netherlands is currently regulated by the Consumer Credit Act.

Benefits of a personal loan

A personal loan is in many cases a relatively attractive form of financing. Firstly, the interest is often much lower than with other forms of credit. The interest, the duration and the installment amount are also fixed, so that the borrower is not confronted with unpleasant surprises.

Moreover, this fixed term can be adjusted to the economic life of the property to be financed. Personal loans usually contain “built-in” coverage against the death risk: if the borrower dies, then his debt (sometimes: up to a certain maximum amount) is waived. For older people it can be difficult or even impossible to get a revolving credit. Especially if they have no collateral, the personal loan is often the preferred form of financing for them.

Revolving credit

Revolving credit

The revolving credit is a form of financing in which, unlike a personal loan, it is possible to re-take amounts already repaid. The term of a revolving credit is variable in practice, so that the borrower can flexibly withdraw and repay money. A theoretical term is set when the loan is taken out, but it does not have much practical significance because of the assumptions underlying it.

Other features of the revolving credit are:

  • The duration is variable
  • The interest is also variable
  • The installment amount can change
  • Early repayment (without costs) is possible

Credit limit

The lender and the borrower agree on a credit limit or credit limit: the maximum amount that the borrower can borrow at any time. However, it is up to the borrower to determine how much he or she actually wants to borrow, as long as the total amount remains within the agreed credit range. A borrower can withdraw the full amount immediately upon commencement, but it is also possible to do so in a number of steps. In addition (as already indicated above) already repaid amounts can be withdrawn

Duration

The term of a revolving credit is variable in practice, so that the borrower can flexibly withdraw and repay money. A theoretical term is set when the loan is taken out, but it does not have much practical significance because of the assumptions underlying it.

  • The credit space is fully utilized immediately upon commencement
  • The interest rate does not change during the term
  • The borrower does not make additional repayments
  • The borrower does not follow up
  • The installments are paid on time every month

However, it may be clear that these assumptions are usually “in conflict” with the specific (flexible) nature of the revolving credit! If the interest rate changes, with a “variable revolving credit” both the installment amount and the term of the credit change; in the case of a “fixed revolving credit”, only the term changes in such a case.

Term amount

The designation “variable” and “fixed” just mentioned for the two types of revolving credit actually relates to the installment amount to be paid. With a fixed revolving credit this is based on the agreed credit limit. Any follow-up withdrawals, extra repayments and interest rate changes have no consequences for the amount of the installment amount. (They do influence the duration of the loan.)

The installment amount for a variable revolving credit, on the other hand, depends on the credit actually taken out. Extra withdrawals and repayments here do have consequences for the amount of the installment amount, just like interest rate changes. Term amounts consist of an interest part and a repayment part. Because the loan is repaid, the outstanding debt decreases with the passage of time. As a result, the term amount also decreases with a variable revolving credit.

Early repayments

With a revolving credit, the borrower always has the option of paying off (extra) early; there are no costs involved (unlike a personal loan or other forms of expiring credit).