Today, the credit card has managed to rise to the top rank of the most widely used payment instruments in the world. Not only does this card make it possible to avoid traveling with a large sum of money, but above all it makes it possible to have a reserve of money available at all times. Although very useful, credit cards are unfortunately horribly expensive. Especially when these are exposed. In this new article, we explain to you what are the advantages of buying back your credit cards and thus keeping control of your budget.
Want to know more about redeeming credit cards? Then you've come to the right place! We will explain everything to you through this new article.
Redeeming your credit cards, what does that mean?
To begin, let's recall what a credit card is. It is a card that allows its holder to make purchases without resorting to the use of cash. Unlike a traditional debit bank card, the credit card works overdraft. That is to say that you can use a certain amount of money available on your card but then you must repay this money monthly or in one go.
By definition, buying back credit cards is a financial transaction that consists of buy back its various outstanding loans by a single financial institution. Its main interest is to lower the amount of monthly repayments using a lower interest rate and an extension of the repayment period.
With a redemption of your credit cards, you benefit from a lower monthly repayment and therefore a better controlled budget. In addition, your various credit cards are up to date again and you therefore benefit from a balance available in case of emergency.
What are the benefits of redeeming credit cards?
The benefits are many! Indeed, buying back your credit cards saves money and helps you find a balanced budget. Here are all the different advantages you could enjoy by redeeming your credit cards:
Decrease the interest rate
Today, interest rates on credit cards are very high. These usually vary between 9% and 12% according to the legal indications in Switzerland. Compared to private financing, you could save up to 8% in interest on your financing. With a lower rate, you therefore save money every month!
Rebalance your budget
When you have several credit cards that are overdrawn, you also have to make several repayments at the end of each month. Since the rates are high and the repayment terms low, this therefore implies significant monthly payments. With a consolidation of your loans, you only pay one monthly payment adapted to your budget.
Have cash in case of a problem
Although not very advantageous, a credit card nevertheless makes it possible to have a reserve of money in the event of problem. If your credit cards are redeemed with private financing, these are again available for emergencies. It is indeed always reassuring to benefit from a reserve of money in case of unforeseen events.
Only have one monthly payment
What could be worse than juggling your bills at the end of the month? When we have several overdrawn credit cards, that's what happens. Depending on the monthly payments requested and the state of his budget, it is even sometimes impossible to pay the amounts requested. By redeeming his credit cards, more than one monthly payment is to be paid each month. Thus, you find a balance in your budget.
How to calculate the gain to be made with a redemption of credit cards?
Before deciding on the redemption of your credit cards, it is important to know how to estimate the gain to be made. Here is everything you need to know to easily calculate the gain you will make with the redemption of your credit cards.
☝ First fastest solution
You can perform a simulation using our credit redemption calculator. You just need to know the amount of your current debts, enter them and the system will show you your new monthly payment.
If you are interested in the new monthly payment and want to save money, you can complete your data in less than 2 minutes. Then an operator will contact you to perform the operation with you. Nothing's easier !
✌ Second option
A little longer but just as fair, you can do the calculation by hand. To do so, you will need to do the following:
- Gather all your credit card bills.
- Add up your different monthly payments as well as the amounts of the corresponding debts.
- Then compare the total of your monthly payments with the new monthly payment of your future financing.
To make this explanation more telling, here is an example in the form of a table.
|List of cards||Open amounts||Monthly payments|
|Bank A||CHF 4'500.00||CHF 259.00|
|Bank B||CHF 3'000.00||CHF 319.00|
|Bank C||CHF 1'750.00||CHF 120.00|
|Bank D||CHF 6'200.00||CHF 485.00|
|Totals||CHF 15'450.00||CHF 1'183.00|
Once the total of your monthly payments is known, all you have to do is compare it with the new monthly payment for your future financing. In this example, for a private loan of CHF 15,450.-, the new monthly payment would be CHF 225.35. So you could save up to CHF 957.65 each month !
Our conclusion on the redemption of his credit cards
Regardless of the state of your finances, buying back your credit cards is always a good solution since you lower your interest rate. Paying less and finding a balance in your budget is indeed always a very pleasant feeling.
Although the process may seem complicated, in reality it is not! In less than 2 minutes, you are rid of your bills and you find the smile with your budget. In addition, our specialists take over once your request has been made. So you have nothing more to do except thank us for the work.
Now that you know how to proceed to take advantage of a buyback of your credit cards, take the time to contact our specialists. They will accompany you in a neutral and confidential way in your approach.
Do you have any questions before applying? Our advisors are there to answer your questions 7 days a week directly on WhatsApp. Ask us for more information and we will be happy to answer you!