Refinancing can be viewed in two aspects - as attraction by credit institutions of cheap interbank loans or loans from the Central Bank of the Russian Federation. In another context, refinancing for a borrower is obtaining a new loan from a bank on more favorable terms for the full or partial repayment of the previous one.
Refinancing of consumer loans
If the borrower has temporary financial difficulties, he can ask his bank to provide a loan restructuring, namely, an increase in the loan term when changing (decreasing) the amount of the monthly payment. It should be noted that not all banks make concessions to the borrower. Then it is worth trying to refinance a loan.
The loan refinancing scheme is as follows. The borrower takes a loan from another bank and with its help pays off the debt in the old one. Refinancing allows not only to reduce monthly payments, but also to lower the interest rate, and in some cases - to change the currency of the loan and replace several loans with one.
Today it is possible to refinance in almost any large bank. Most often, borrowers refinance mortgages, less often car loans and consumer loans.
Today, refinancing accounts for up to 10% of the total volume of lending. Banks usually refinance loans with a maturity of more than 6 months.
In the case of a home loan, it makes sense to carry out refinancing only until the five-year repayment period is reached and if the remaining debt is more than 30%. At the same time, difficulties may arise with the renewal of the contract, tk. the loan is essentially a collateral.
When refinancing, the borrower's solvency is assessed by the bank, as in conventional lending. The borrower's credit history is also taken into account. Thus, the presence of delays in payments will be the most likely factor in refusing to provide a new loan.
The package of documents for refinancing is fully consistent with the package of documents for a regular loan. In most cases, this is a passport, a 2-NDFL certificate, a loan agreement, documents on the balance of the principal debt and loan debt. For a mortgage, pledge documents are also required.
In general, it does not always make sense to look for a refinancing program in a bank, since you can simply issue another consumer loan without specifying the purpose of obtaining it. Sometimes it will be easier to get such a loan than to refinance.
Refinancing in the interbank market
In the interbank lending market, one of the forms of refinancing of commercial banks is loans from the Central Bank of the Russian Federation. The key parameter in this case is the refinancing rate. It is determined based on the dynamics of the economy and inflationary processes.
Refinancing rate - the amount of interest on an annualized basis payable by the Central Bank for loans that the central bank has provided to credit institutions. Today it is 8.25%.
It is on it that banks' interest rates on loans and deposits depend. Banks attract deposits at a rate slightly lower than the refinancing rate, and loans at an interest higher than it.
