After years of regular repayment of the loan, it turns out that the terms of our commitment differ significantly from the current market proposals. We ask ourselves – what is the point of overpaying for a loan? Do we have any chance to improve the financing conditions? Along with the ongoing financial education of the society, interest in refinancing loans is increasing.

A refinancing loan is, in the simplest terms, a conversion of an obligation incurred in one bank for an obligation given by a second bank. Refinancing may cover different types of loans, ie a mortgage loan, a cash loan or a credit card account, but this procedure usually applies to long-term loans. It is only in the long term that we can confirm market changes that could significantly affect the parameters of the loan.

At the same time, our life situation, directly determining the ability to service debt, does not change significantly from day to day. When we start earning better or have received an unexpected cash injection, we may consider shortening the funding period. It is true that the loan installment will be higher, but in return we will soon become the owner of the property purchased for a loan. When our income is lower, the way to lower the installment is to extend the funding period.

An attractive margin is not everything – summarize and compare all fees

Most often, customers decide to change the lender due to the unattractive level of interest on the loan. Keeping in mind that we will pay off the liability for many years, even a slight reduction in the amount of the installment will result in significant savings over a broad time horizon. The loan interest rate consists of two elements. For liabilities incurred in zlotys, this is a variable rate in the form of WIBOR rate and the bank’s margin determined individually, which makes the offer attractive.

The lender has no influence on the WIBOR rate, competing with the size of the margin. Banks setting its level are guided by such factors as creditworthiness, own contribution or the purposefulness of the loan. Looking for the most attractive offer, it is worth to evaluate this parameter first.

We assume that we have chosen an offer which is more favorable in terms of credit margin. In the next stage, let’s focus on the other costs associated with refinancing the loan, because they can ultimately decide on the profitability of the project. The amount of additional fees may be paradoxically higher than the potential benefits. Let’s check if our current borrower did not reserve in the contract the commission on early repayment of the loan. Usually this fee is charged in the first years of the loan and is usually from 2% to 3%.

Another possible burden is a commission for granting a loan to a new bank, a re-valuation of a property or a fee for another mortgage entry. Verify necessarily the period in which we are obliged to repay the loan, because the lower installment may result from the extension of the repayment period, which will pay more interest and the loan may turn out to be more expensive than the original solution. It is best to compare offers with the same repayment date.

Is it worth it at all?

Deciding on a thorough analysis of the current and future credit offer, it may turn out that refinancing is a viable solution. Remember that this is not a rule and it may turn out that after completing numerous formalities, we will replace your current loan with a solution that is more expensive. The period of incurring the original commitment is of great importance. In times of high interest rates, credit always costs more, so it is worth checking when interest rates are consistently lowered.

We should not forget that a competitive offer is an excellent contribution to the attempts to renegotiate conditions with our current lender. Eventually, the financing conditions may improve without the need to change the bank.

One of the most needed types of loans is a non-bank loan. This is a loan that is not contingent upon a specific purpose and is not intended to achieve a predetermined goal. What are target loans and what is their limit? What are the collateral required for non-bank loans for any purpose? Where can I obtain nonbank loans in accordance with my desires and needs? All the answers – later in the article.

A non-bank loan for all purpose and objective loans

Targeted loans are pre-designated loans for a specific purpose and can not be used for any other purpose. The classic example of such loans is the mortgage – a loan for the purchase of a real estate property that each person experiences at least once in his life, and is provided by any financial institution – a bank, an insurance company, a company dealing in finance and real estate, Although the loan is registered in the name of the borrower, but is transferred to the person who sells the property. In return for a loan, a warning note is posted on the property purchased with it, for the benefit of the entity that granted the loan. Thus, a person commits himself to a designated loan, which he must live with for many years. A loan for any purpose other than a bank is in the opposite discussion of the above – a loan that is not limited to a specific purpose and the body that grants it is any non-bank body.

The guarantees against a non-bank loan for any purpose

Since the purpose of the loan was not determined in advance, and since the lender does not really have control over what was done with the money, it only makes sense that the demand for guarantees against such a loan arises. The type and amount of guarantees, however, are subject to change. Borrowers with high incomes and a good obligo at the bank may receive a loan for any non-bank purpose with minimal demand for guarantees, or in the absence of such a demand. Low-income borrowers and problematic borrowers may find that they need more concrete guarantees. This is in addition to tougher repayment terms.

If you have an interest in taking a non-bank-purpose loan from a reliable and experienced company that can match the loan to your requirements and needs – this is the right place for you. You should contact us now and our professionals will come back and help you make the most convenient loan. Adjustment of the loan relates to the repayment conditions, the amount of the monthly repayment and the payment of the repayment payments.

Many people use these terms interchangeably. Although both terms involve borrowing, the loan and loan function on a completely different basis. So what are they different? Let’s solve this dilemma once and for all.

Credit – in the bank and on paper

Although the loan in non-bank institutions is often called a working loan, in fact real credit can only be obtained in a bank. It is subject to the provisions of the Banking Law and the Act on consumer credit. While the latter document also regulates the activities of non-banking companies, only banks act on the basis of banking law. Therefore, only they have the full right to grant loans.

The details are important

The aforementioned banking law also regulates in detail the manner in which the loan agreement should be concluded. Well, in order for it to have legal force, it should be made in writing. Furthermore,  it must contain accurate information on the loan amount, its total costs, interest and the amount of the commission. The loan agreement should also include information about the purpose of the loan (except for consumer loans, which are allocated to meet the current needs of the borrower) and the rules for its return in addition to the exact repayment date.

Although we get the loan when we get a loan, we never get our property. All the time they belong to the bank, and we can only dispose of them for the time specified in the contract. Therefore, the bank (as the owner of cash) can control how we use the loan and whether we issue it in accordance with the original purpose.

They will illuminate before they borrow

Although money is not our property, we must pay for their use. Each loan is accordingly interest-bearing, and the bank often earns a huge commission for its granting. What’s more, some banks deduct a commission from the amount of the loan, which ultimately gives the client less, and the initial amount must be paid off anyway. Whether we like it or not, the loan will always cost and we will pay back more than we borrowed.

Before the loan we receive the bank will thoroughly scan our current financial life. We will therefore be checked in the debtors’ databases and asked to show the sources of our remuneration. If we have any debts or no permanent employment, we can say goodbye to the dream of a loan.

Loan – from where you want and without formalities

A loan, however, is a concept much wider than a loan. You can get it at the bank, in a non-bank institution, and also get it from other people (so-called natural persons).

In contrast to loans, loans granted by non-bank companies operate exclusively on the basis of the Consumer Credit Act. In the case of loans from natural persons, all legal regulations are specified in the Civil Code.

A loan agreement may be made in writing, but it does not have to. The so-called. the verbal agreement is also binding on loans. However, when it comes to loan companies, they usually write a written loan agreement with their clients. Preparing a contract in writing is also recommended for any other loans over PLN 500. In the case of disputable matters, this contract may constitute a basis for the recovery of its rights.

A free loan exists really!

As you can see in our comparator, more and more non-bank companies provide loans for PLN 0. People who previously used loans often do not believe that they can get cash for free. Meanwhile, it is possible because the loan does not have to be interest-bearing. The one who borrows can set the cost of such a loan, but it does not have to charge a fee for it. It all depends on the conditions that will be agreed with the borrower.

What’s more, in the case of loans, there is no obligation to set a repayment date. Non-bank institutions tend to introduce such a deadline, but in the case of loans in the family you can easily afford to say “you will give up when you can.”

They give and do not ask

Another factor that differentiates a loan from a loan is the intended use of borrowed cash. While in the bank we have to explain why we need extra money, so in the case of a loan is not necessarily. That’s why when we take a minute, nobody will ask us what we want to spend that money on. We can therefore distribute the borrowed money to various needs without having to inform anyone about it.

And finally, in the case of loans, all formalities are kept to a minimum. Lenders often do not require documents such as confirmation of income source. Often, they do not check borrowers in debtors’ registers, and if they do, negative records do not always result in the loan being denied to the client. Borrowing cash in a non-bank institution is so much simpler and faster than taking a loan at a bank.

Do not make mistakes!

As you can see, credit and loan are governed by completely different laws. Why, then, misidentification of these two products as identical? Most likely, this is due to the fact that banks often offer loans as well as loans, the latter being definitely more popular. It is worth carefully reading the contract and carefully checking what product we are dealing with. Credit and loan have different legal consequences, which is why incorrectly naming these products and ignorance of differences can lead to many unpleasantness, especially when we are unable to pay off the debt on time.

Do you have a problem with repayment of the loan? Check what threatens you!
You did not repay the loan? See how to react with your head!

Until recently, the debit on the account aroused poor associations. Today, we look at the solution with a much more favorable eye. So should debit in a bank account be treated as an alternative to a quick loan? Let’s check when to choose each of these solutions.

Although some banks are already able to guarantee something like a quick loan, this type of offer still remains the domain of non-bank companies. It is in these second institutions that we can easily get money without unnecessary formalities, ideal creditworthiness or above average income. In the bank, however, the credit procedure is usually more complicated. But if we have a bank account that supplies regular income, then in the case of temporary financial difficulties, we can get money from debit. What’s more, in this case, cash is received practically immediately and we do not have to fill in any applications. This solution therefore seems quite attractive.

Loan and debit – what’s going on?

However, before we eagerly reach for the funds available under the debit, it is worth checking where the funds came from and how the debt is paid. Nobody, after all, has no doubt that the money received in this way will have to be given back.

Debit – small amounts, low cost

The debit is in fact the amount that the bank provides to the holders of savings and settlement accounts in the form of a revolving loan. The amount of the granted limit depends mainly on our income and time of cooperation with a given bank.We can use the funds granted as part of the debit whenever you run out of money in your account. What’s more, it is not a one-time help. You do not have to use the debit all at once – you can reach for money as often as you need – until you reach the limit of allocated funds.

And what is the repayment of such an overdraft? Usually, all debts to your account (eg monthly pay) are counted towards your debt. This happens until we completely settle your debit. However, it is worth remembering that we have a certain period of time to repay such a commitment (depending on the bank’s policy).

What’s more, interest will be charged for the period in which we used funds from the debit . Of course, these interest will only be counted on the amount of debit we used. Currently, the interest rate on which banks are guided is about 10% -20%. When we pay back the entire debit, it will be automatically renewed, and we will be able to use the funds made available within the limit.

Loan – larger amounts, more time to repay

A loan is a solution that requires a bit more of a west. First of all, we need all the offers on the market, choose the one that best meets our needs, secondly submit the application and complete all formalities, and thirdly – keep our fingers crossed so that the lender will consider our application positively. In non-bank companies, all formalities have been kept to a minimum, which is why the whole process usually takes about a dozen or so minutes.

Even so, the quickest way to get cash is still the debit on your account. What’s more, we’re never 100% sure that  the lender will approve our application and give us a loan. In the case of debit, the case is clear from the beginning.                              

However, if we take into account the amount of the liability, the loans give much better opportunities than the debit . Currently, non-bank companies are willing to borrow up to several thousand and repayment period calculated in years. The debit possibilities are closed in just a few thousand, and repayment is often required after about 30 days.

In addition, in the case of a debit, we have a certain limit of available funds, which will be renewed only when the funds will be transferred to the account. In the case of loans, we can incur several liabilities simultaneously in different companies . Thanks to this, we get a much larger cash injection than it can offer us in the form of a debit.

Summing up the previous considerations, we can conclude that both the debit and the loan have their weaknesses. The choice of the right product will therefore depend on the needs we are expressing at the moment,

When is it worth using a loan?

It is worth reaching for a non-bank loan if:

• we need a lot of cash,
• we want to spread the repayment of the liability for a longer period,
• we do not have regular income,
• we do not want the bank to know about our obligations,

When is the better way to choose an account debit?

The debit will be an appropriate solution if:

• we want to have instant access to extra cash,
• we will need additional funds in the amount of up to several thousand zlotys,
• we receive regular receipts to your account,
• we want the lowest commitment costs

summarizing

It is difficult to give an unambiguous answer to a loan or debit question. It all depends on our current financial situation. So if we face such a dilemma, it is worth answering the question of how much cash support we need and what funds from the monthly budget we can spend on repayment. Next, let’s check what offer of the debit the bank has prepared for our account. It may turn out that the offer will not meet our expectations. Having a ROR does not mean automatic access to debit. In this case, the loan may be the only solution available.

Compare loans in installments and choose the solution that’s right for you!

There were already payday loans, there were installment loans – now banking companies are entering completely new areas. To facilitate the use of borrowed money, they introduced something that we already know well from the offer of banks – a credit line. Although in this case, we will call it a loan line.

What is a loan line? 

In the simplest terms, it is a loan limit set on the basis of an appropriate contract, which the borrower can use for any purpose. A person taking a loan has constant access to money and decides when and how much he wants to withdraw or pay back . Each repayment reduces the debt and at the same time makes the loan limit again returns to the original amount. If, therefore, the loan limit was PLN 2,000, the client paid out PLN 300, which after a month (with interest), he returned, and the previously mentioned PLN 2,000 remained at his disposal.

The loan line can be used throughout the duration of the contract. For example, in a non-banking company, the Banknotes include such a contract for 12 months.

How to borrow?

To start a loan line, it is usually enough to register on the selected lender’s website and submit an application. The customer also immediately chooses the amount of the limit and the period in which he wants to use the money. Then the application goes to the loan company, where it is analyzed, eg in terms of the creditworthiness of the person applying for a loan.

After accepting the application, the customer receives information about the loan limit granted to him. If he decides to use it and accepts the terms of the contract, he will be able to make the first withdrawal from his loan line. For this purpose, you will usually need to log in to the account created during the registration and select the amount to be paid. After confirming your choice, the payment made by the customer will be credited to his account.

However, you will not always be able to withdraw all available funds immediately. Some companies do not allow customers to take more than 50% of the granted limit when they first pay .
However, the borrower can always make payments when he needs money. Financial resources are at his disposal at all times.

How to pay back?

Although the customer decides when to repay the borrowed money, the lenders that offer the loan line usually divide the duration of the loan limit into several settlement periods. Usually, one billing period means one month. In each billing period, the customer must make a minimum repayment .

The minimum amount is usually determined by a contract or a separate document issued by the lender. Usually, at the end of each billing period, the loan company sends information about the appropriate repayment. The repayment is made to an individual bank account created for the client.

The customer can of course pay off more than the minimum repayment. Such overpayment will be charged to repay the debt in the following month. Sometimes, thanks to such an additional fee, not only the debt, but also the amount of daily commission charged on it decreases.

Change of repayment date

In the field of payday loans, there was an extension of the repayment date. In the case of a loan line, we can apply for its change and adapt it to your needs. It is usually enough that after the payment made in the first settlement period, we inform the lender about the change of the repayment date and we will indicate another convenient date for us. However, we must reckon with the fact that such a change will cost us accordingly – eg in Euroloan it will be PLN 10.

This change can usually be made several times, which is why it is the right solution for those who are temporarily having problems with repaying the debt.

Is it profitable

The loan line can be an interesting alternative for payday loans and installment loans. As every product, however, it has its advantages and disadvantages. Therefore, we decided to point out the most important pros and cons of this product.

Advantages of the loan line

• the loan line gives you the possibility of permanent access to borrowed money (the borrower pays money whenever he wants)
• the customer decides when he makes the repayment in a given settlement period. However, the repayment can not be lower than the minimum amount
• each repayment increases the funds available on the limit, which you can use again
• the customer can freely change the debt repayment day
• the loan line can be used for a longer period (eg 12 months)
• in some cases, the loan line may be increased during its lifetime (if, for example, the client’s credit history improves).

Disadvantages of the loan line

• to get a loan line you usually have to have a positive story at the Economic and Credit Information Bureaus, and all other liabilities to pay off in a timely manner
• although the customer can repay the loan line at any time, he is obliged to make the minimum repayment once in the whole settlement period (usually every month) along with daily interest
• starting a high-cost loan line may lead to uncontrolled indebtedness.

summarizing

The loan line is certainly a good option for those who need a loan with a longer repayment period. However, before we decide on it, you should consider your financial options. Are we sure that we will be able to give the lender specified in the contract an amount with interest every month?

Remember that each delay with the repayment of the loan line generates additional costs, eg in the form of payment for prompts. So before we decide to run a loan line, let’s check the terms and conditions offered by the lender. Let’s also take a look at the price list (table of fees) and only then will we assess whether we can really afford such a commitment.

Reasons for renovating old buildings: preserve charm, achieve modernity

When buildings were built a hundred years ago, the term “energy efficiency” in the construction industry was far from common: architects did not waste much thought about effective interior design or particularly energy-saving construction methods, instead they paid more attention to style and planned with crooked windows, long corridors , bright, high ceilings and stucco ornaments.

Even today, many prospective buyers still succumb to the charm of old buildings, but at the same time value modern technologies and a modern energy balance of the building. At first this sounds like contradictory contradictions, but with the help of an individual renovation of old buildings, everything can be easily connected. The best thing about it: By doing so, you’ll be saving quite a bit of energy costs in the future.

Savings potential of an old building renovation

In the past, it used to go through all the cracks and windows like pike soup, in the winter, stoves were used in the chord – and that was normal. Today, real estate owners have higher demands on their home. Rarely does a path lead past, to renovate the old building when buying directly. This not only applies to buildings from the first half of the 21st century, but also middle-aged houses from the sixties, seventies, eighties and nineties are often in need of renovation nowadays.

However, the measures taken not only increase living comfort, but also energy efficiency. This is good for the environment and saves money. Façade renovation and new heating systems are usually at the forefront of recovery plans because they offer the greatest savings potential. According to DEKRA, a modern combustion boiler reduces heating costs by up to 25 percent annually compared to an old oil heating system. The old façade conceals a similarly great potential: Modern facade insulation can save another 12.9 per cent on heating costs.

Rough reference values ​​for refurbishment costs

For a house from the 50s or 60s you have to put about 40 percent of the purchase price on top of it again and put it into the refurbishment. For houses from the 80s and 90s, about 20 percent of the purchase price is due for the refurbishment. In the past 15 years, houses account for a good 16 percent. The total renovation of an old building is estimated by specialists with about 400 to 600 euros per square meter living space, individual measures are cheaper and thus faster to implement.

Year of construction alone says nothing about remediation need

The year of construction of the property is not necessarily crucial for their renovation needs. So it may be, for example, that a house from the 50’s was regularly modernized and is in top condition, while a property from the 80s has not been maintained since the first purchase and must now be completely overhauled from scratch. Therefore, check before buying, when the most important components of the property, such as the heating or the facade, were last renewed.

Usual intervals and costs of an old building renovation

Before buying an old building in need of renovation, you should not only find out when the most important building components were last renovated. It’s also important to know which ones will be back soon. Only if you get a good overview of the current state of affairs and the work due for completion in the near future, you can target your remedial measures. The following list shows when which measures usually become acute.

Financing of old building renovation: construction financing or installment loan?

When buying an old building, it is very likely that you have to invest financial resources in its renovation. It makes sense to co-finance the whole thing through the very low-interest mortgage financing and a modernization loan contained therein. This is possible as long as the planned measures by the bank are classified as adding value and the mortgage lending limit of the property is not exceeded by the higher credit. The original mortgage lending, which is actually only for the purchase of the house, is then increased by the sum that you need for the modernization.

The total will be hedged through the land purchase process, and you will pay back what you have borrowed for purchase and modernization at the same monthly rate over the coming years. However, for people who have owned an old building for some time now and would like to modernize afterwards, it is more difficult to accept a new mortgage lending. For this, the property should already be debt-free, which is usually not the case. In such situations, however, offers a good alternative to mortgage lending: A purpose-built installment loan with optimal conditions. 

Assigned Installment Loans for Property Owners

As a real estate owner, you can resort to earmarked installment loans such as a reorganization loan for your modernization. You will get it even if your property is not debt free, and the mortgage lending limit also does not matter. Compared to mortgage lending, the restructuring loan is also less bureaucratic because it does not require a land register entry. All you need to do for the reorganization loan is to prove your status as a real estate owner.

You can do this, for example, with a current land register excerpt, which you can obtain from your local land registry office. Banks grant cheaper rates for the reorganization loan than for a normal installment loan , because they consider the creditworthiness of real estate owners to be better. They assume that a real estate owner is more likely to pay monthly installments for a loan than someone without real estate. This property reward them with better credit conditions.

Our tip: Include state funding in old building renovation

Certain components of your planned refurbishment are supported by government support programs. That means: you do not have to pay for the financing of the new roof or the new heating alone, but under certain conditions receive subsidies or very low-interest KfW loans . Two possible sources for this are the Kreditanstalt für Wiederaufbau (KfW) and the Federal Office of Economics and Export Control (BAFA).

The promotional loans of KfW

KfW offers loans for the installation of ventilation and heating systems, for the thermal insulation of walls, roofs and cellars, through its program 151: Energy-efficient renovation . In doing so, KfW always focuses on increasing energy efficiency, which is why you must first consult an energy consultant who will show you which measures make sense.

Renew heating system using the BAFA

The BAFA loans also allow outdated heating systems to be converted to newer, more energy-efficient and environmentally friendly systems. The subsidies are primarily intended for combined heat and power plants, biomass plants, heat pumps and solar thermal systems. Our table shows you which measures are promoted in detail by which program.

Measures and appropriate subsidies for renovation of old buildings at a glance

A comprehensive refurbishment is a major project that takes a lot of time and wants to be well planned in advance. After all, you want to enjoy your old, new home for a long time and at the same time not financially accept it. Assistance and expert advice are indispensable in this case. It is best to consult the energy consultants of your Consumer Center for the planning.

When it comes to financing the project, our mortgage specialists are your point of contact. They not only accompany real estate buyers through the purchase process and plan the modernization costs into their mortgage lending. They also help real estate owners to find the appropriate installment loan for subsequent remedial measures.

Cheap restructuring loans for your old building

We make financing easy for you: Our specialists are looking for loan offers and suitable providers for the refurbishment of old buildings. Optimal conditions included. To receive our support, simply request non-binding financing proposals. Your on-site consultant will contact you personally within 24 hours.