An option that allows you to better manage the debts you have with several entities is to focus on one of them. You can do this by requesting a special loan called a debt purchase at some financial institution. In this article we will explain how this alternative can also help you pay less interest.
Why do financial institutions buy debt?
The profits of the financial institutions come, in large part, from the collection of interest for the different loans they issue. Therefore, they have different strategies whose intention is to attract new credit users and maintain existing ones.
Whenever financial institutions grant you a loan, they are exposed to the risk that you cannot cancel it. One of the actions they take in this regard is to study in detail how your financial behavior has been. In other words, if in previous loans you have canceled your installment payments on time or incurred default.
The entire process of investigating your financial behavior results in a cost assumed by the entity. When the bank buys you a debt, a large part of this expense is saved, previously made by another institution. Then, financial institutions find it profitable and convenient to make debt purchases, as in the case of mortgage substitution or refinement.
Can I pay less interest with a debt purchase?
A debt purchase may or may not pay less interest than in the original loans. This will depend on the interest rate offered by the bank that buys your debt. For this reason, you should always study if when performing this operation you get better conditions than the original ones.
Fortunately for you, the financial market in Mexico is currently very competitive. Therefore, they are constantly bidding for new customers, offering instruments with a competitive interest rate. Therefore, it is very likely that you will get debt purchases that mean you pay less interest.
We also recommend that you also look at other credit conditions, not only at your interest rate. For example, at the cost of the insurance they could place as a requirement to make the purchase of debt. And if there is a penalty at the time of making advanced payments of capital or credit installments.