Refurbishment loans are a special bank loan for consumers for household renovation needs, with advantages such as high amounts, low interest rates, long duration and early repayment。
A large number of households have already spent half of their savings on house purchases and have been overstretched at the time of renovation. At this point, the renovation loan became a good option for us to move into our new home and enjoy our lives。
For the owners who are going to apply for the renovation loan, there are a number of friends who are wondering how to apply for the renovation loan. Today, the eight-dollar net solves the puzzle. The full text is full, and it is hoped that it will help you。
I. Common questions and answers on renovation loans
1. How interest rates are calculated
Refurbishment loans are generally promoted at “scheduling interest rates” ranging from about 0. 20 per cent to 0. 33 per cent, with an approximate annualized rate of 4. 55 per cent to 7. 35 per cent。
It should be noted that the phasing rate of the renovation loan is not fixed. Periodic interest rates generally vary in different regions and branches of different banks, depending on the actual situation。
Since the repayment method for the renovation loan is the equivalent of interest, the calculation of the annualized interest rate requires the use of one parameter, irr (internal late of return), or “internal rate of return”。
The internal rate of return is the present value of financial inflows equal to the total present value of financial flows and the net present value equals the discount rate of zero. It is in fact a rate-of-return trial tool, a value derived from a more complex compound calculation, which takes into account not only the rate of return on investment but also the time value of the funds。
Real annualized interest rate for renovation loans = 12*irr*100。
Assumptions: renovation loans with amortized interest rate of 0. 2 per cent, loans with a total value of 100,000, repayments in 60 instalments over five years and irrs of approximately 0. 38 per cent; then the annualized interest rate on renovation loans for a five-year period is based on the formula = 12*irr*100 = 12 x 0. 38 per cent x 100 = 4. 55 per cent。
This annualized interest rate is still more cost-effective than many credit products. For example, the annualization rate for car loans is between 7 and 12 per cent, and the annualization rate for credit card instalments is between 13. 02 and 17. 79 per cent. It is not difficult to see that the annualization rate for car loans and credit cards is about one times higher than the annualization rate for renovation loans。
2. Method of repayment
The repayment of the loan for renovation is mostly in the form of an equivalent interest-rate repayment, which is constant monthly and the principal + interest is returned on a monthly basis. The advantage of this approach is that it ensures that you have a relatively stable amount of repayment per month throughout the repayment period and does not result in a change in the monthly contribution due to the repayment of the principal。
3. Loans for renovations for several years
According to the board's issuance requirements, the duration of the loan is between one and five years, but most people will opt for a longer period of five years. Because of the long duration, the monthly supply is less stressful; and the near-converted annualized rate of the loan is not high and is low in the credit line. And if you need it, you can pay in advance。
4. Loan line
It is common for banks to be loanable at a level of between 80 and 1 million, and it is generally possible to borrow around 200,000 in short clothes, essentially meeting the consumption needs of different groups。
Ii. Conditions for applying for loan for renovation
Refurbishment loans, as a large credit loan, are not subject to a high threshold and do not require any guarantees。
1. Basic conditions for applying for a loan for renovation:
(1) 18-65 years of age (including loan time)
(2) have a decent career and stable income and the capacity to repay the principal of the loan as it matures
(3) the person in whose name (the immediate family or spouse) has the property and is able to provide corresponding information such as the deed of purchase or purchase of the house, invoices, etc.
(4) personal credit is good and the record of letters of credit is not seriously negative。
Note: the threshold of application varies from bank to bank, depending on the actual situation。
Requests for letters of inquiry:
When applying for loans for renovations, letters are one of the important references. Banks are required to judge the creditworthiness, willingness and ability of lenders by means of letters。
If the lender is not creditworthy or is over-indebted, this means that the lender has a greater risk of future overdues, and the money loaned by the bank may not be recovered. It is therefore very likely that banks will reject the loanee's application when the loanee's credit card is not good。
To apply for a loan for renovation, every effort should be made not to:
(1) the emergence of “three thousand six”
That is, three consecutive months in two years and more than six cumulative overdues。
(2) late payment
As long as the overdue payment is not made, the record will remain in place and the delay will allow the bank to challenge the applicant's repayment capacity。
(3) excessive external queries
The fact that loans are made to banks or institutions and that they are authorized to search for their own correspondence reports also shows that the applicant's financial situation is not encouraging and that he/she is vulnerable to being denied loans. Many banks have requested letters to record not more than three times in almost one month and not more than six times in the last six months。
3. What information to prepare
The types of information usually required are as follows:
(1) identification documents: identity cards, family records, marriage certificates, etc
(2) proof of real estate: real estate certificate, purchase invoice, purchase contract, mortgage contract, etc
(3) proof of means: social security, provident fund, surrogate wages, bank flow, etc
4. Conditions for lending
At the appropriate stage of the renovation, the owner provides feedback on the construction schedule and the bank arranges for staff to come in and take photographs to verify that the renovation is real, and the loan is released。
As a result of the different types of accommodation, the renovation lending process can be somewhat different:
(1) gross house: need for two separate loans
The first part was released after the completion of the utilities and the remaining 50 per cent was released after the completion of the mud。
(2) equipping room: one-time loan
Access to the building is free of photograph, with a one-time loan; failure to access the building requires an inspection to take a photo and another sexual loan。
(3) refurbishment of the old house: two instalments required
Refurbishment loans are made for the purpose of removing the toilet or kitchen at a minimum, disassembly the old renovations and re-discharge the utilities. Dismantling is followed by a 50 per cent release and the remaining 50 per cent is posted on the wall。
After approval of the renovation loan, the bank will send you the renovation schedule card. On the basis of the loan period requested by the owner, the bank will place the amount of the loan in the applicant's renovation credit card, which will be available upon activation。
Renovation loans, which do not count interest, are recommended to be activated and disbursed by the owner's friend within six months. Most of the banks have built-up loans of six months' duration。
Refurbishment loans are earmarked for consumption related to hard, soft, furniture, household electricity and fit-out services in domestic clothing. Not only is it possible to swipe cards at a physical store online, but it also supports online shopping。
Note: the card is not available and is also intended to guarantee the use of the loan for the renovation。
Three or eight dollar net summary
Each bank has its own access threshold and auditing criteria, and when it goes to the bank to make a loan for the renovation, it is vulnerable to being denied credit, losing the opportunity to apply for it in vain, and adding a letter call to pay. This is why it is the credit that makes the loan even more productive by being able to use the resources of the renovation of the loan platform。
