Moscow, April 14 – Many banks offer borrowers in a difficult financial situation to “take a break” from a loan from two to six months with the help of credit vacations: they must be carefully prepared, otherwise you may run into unforeseen expenses, Olga Daineko, said an expert at the NIFI Financial Literacy Center of the Ministry of Finance of Russia , for the News Agency.
Since 2019, mortgage borrowers have a legal opportunity to receive temporary debt relief. For other types of lending, the grace period was provided for a limited period of time and in accordance with the requirements of the borrower to reduce income: during a pandemic and in connection with sanctions. Today, SOO subscribers and members and their family members, as well as mortgage holders, are entitled to credit leave.
“It is important to understand the differences between ‘legal’ credit holidays and individual banks’ grace period lending programs. It happens that the borrower meets the requirements of the law, but does not indicate the type of grace period in his or her application for a credit holiday. In this case, instead of a credit holiday, Guaranteed by law, you can get “vacation” on the terms of the bank. Inattention and haste “at the entrance” will turn into disappointment after the end of the vacation, “Daineko warns.
For example, it may turn out that the accumulated debt will need to be paid immediately after the holidays: the monthly payment will increase, and the expert pays attention. And Daineko explains that after the holidays, “according to the law,” the accumulated debt is transferred to the end of the loan, as a result of which the loan term is increased, but the monthly payment remains the same. The exception is credit card debt. A situation may also arise in which consumer lending debt is accrued at the contractual rate of interest, rather than 2/3 of the market average.
Tell the expert when it may be unprofitable to refinance the loan
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