Debt restructuring despite poor Credit Bureau is not as easy to implement as some consumers assume. Nevertheless, consumers with bad Credit Bureau who want to reschedule should not try anything, because nothing is impossible.
What happens when a debt is rescheduled?
In the event of debt restructuring, existing loans are repaid and combined into a new loan. Borrowers have the option of changing both the new loan amount and the term in terms of the amount so that the monthly charge is reduced in the end, even if the new loan is higher. The debt rescheduling can take place at the previous lender or at a completely different bank that promises credit on favorable terms. The aim of debt rescheduling is usually faster debt relief or a reduction in credit costs or a reduction in the monthly charge.
Debt restructuring despite poor Credit Bureau is so difficult to achieve because banks, as lenders, attach great importance to the creditworthiness of borrowers. If a debt is rescheduled, the creditworthiness is checked again. However, because there are many ways in which consumers come to a negative Credit Bureau, it is sometimes quite possible that a debt rescheduling project can be implemented without any problems, even if the borrower’s Credit Bureau is negative. It also always depends on the specific case of whether debt restructuring is feasible or not despite poor Credit Bureau. For this reason, those affected should always be advised not to miss anything when trying to reschedule. Even if not every bank is ready to implement a debt rescheduling project, with a little patience you may be able to find a bank that will reschedule.
What possibilities of debt restructuring are there despite bad Credit Bureau
If the loan applicant receives negative Credit Bureau information, a new lender will not be willing to reschedule existing loans. However, it is conceivable that the house bank, which knows the customer, his income situation and his financial difficulties, could be the new lender. Of course, how much debt is to be rescheduled and what is the reason for the Credit Bureau entry is important. Borrowers with existing mortgage lending have good chances that the house bank will approve the planned debt restructuring. After all, this is a mortgage-backed loan that also gives the bank sufficient security if the Credit Bureau is bad.
The number and amount of outstanding receivables can also play a role when it comes to processing a debt rescheduling despite poor Credit Bureau information. Credit Bureau makes entries in unpaid energy or telephone bills less difficult during debt rescheduling negotiations. Even if the entry in the Credit Bureau is already marked as completed, there is an increased chance that a debt restructuring will be approved despite bad Credit Bureau information. Many entries in the Credit Bureau are only deleted three years after they have been completed, but lose their explosiveness when they are completed. The fact that they can still be viewed is only intended to provide potential lenders with the information that something was here.
What should you watch out for when rescheduling despite bad Credit Bureau?
Anyone who has found a cheaper financing option at another bank, but has bad Credit Bureau information, should first do everything to have the negative Credit Bureau entry deleted. If this is not possible, a personal discussion with the bank can be helpful, during which the reasons for the negative entry can be plausibly explained. There are some banks that are quite willing to work with the customer to find a way out of the liquidity crisis. After all, they too want their money back and are therefore willing to compromise. However, borrowers should generally avoid having to additionally secure the debt rescheduling loan. If you involve an uninvolved third party in your financial problems, you could harm the guarantor without solving your own problems.
Borrowers who have repeatedly had arrears on current loans and who are currently unable to prove attachable income have little prospect of rescheduling. Affected borrowers should also not think about a possible debt rescheduling, but rather contact a debt advice center to get professional help in solving the debt problem.