Refinansiering Lån – What to know about Loan Refinancing in Norway

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Debt refinancing is a possibility not only in Norway but also in many other parts of the continent and the entire world. However, people considering debt refinancing must understand the conditions for securing such credit lines. Furthermore, the decision to do so has to be well-informed.

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Speaking of refinancing regulations in Norway, there are a couple of them. For instance, the new credit line should not exceed the previous debt in the case of mortgage loans. There are also regulations on repayment duration and a couple of other things. The whole point being stressed here is the need to be aware of the rules that apply.

Well, this article intends to shed more light on debt refinancing in this Scandinavian nation. The essence is so that people have a better understanding of how it works in Norway. So, keep reading to find out more.

Information about Debt Refinancing in Norway

There are several things to know about debt refinancing in Norway. Knowledge of these things is important for several reasons. For one, it ensures that you are not stuck and make the right decision getting such credit lines, if you have to. To this end, here are a few answers to commonly asked questions on debt refinancing here:

Can You Get Unsecured Refinance Loans?

It is possible to get unsecured refinance loans in Norway. This means that there are debt refinancing credit lines that do not require the borrower to pledge any form of collateral as security. However, there are usually more stringent laws for securing such. Furthermore, the possibility of securing such depends on several factors.

One such is the kind of pre-existing loan that needs refinancing. For example, the chances of getting an unsecured loan to refinance a pre-existing mortgage loan are very slim. For one, this is because of general laws that are not friendly to such practices.

How Much Money Can You Get with an Unsecured Refinance Loan?

On the whole, the amount is roughly between 10,000 and 600,000 Norwegian Kroner. There is hardly any credit service in the country that would be willing to offer beyond this to people seeking unsecured refinance loans. Furthermore, the exact amount that a person can get with an unsecured refinance loan depends on several things including:

The amount of money requested for
The finance structure of the lender
The eligibility of the loan applicant

All of the aforementioned determines how much a lender can get from unsecured refinance loans. To provide a better perspective, let us discuss the aforementioned.

Firstly, the amount requested by the loan applicant forms the basis for further assessment by the prospective lender. For example, a person who requests 200,000 Norwegian kroner would not be getting any more than 200,000 Norwegian kroner, if the request is granted.

Secondly, lenders have a structure. One crucial aspect of this structure is how much the lender is willing to offer people who request unsecured refinance loans. For example, some lenders would only grant requests within a certain amount.

For instance, that amount can be set at 300,000 Norwegian kroner. In other words, people who need credit lines exceeding this amount do not stand a chance with such creditors. This is even if they are very eligible for such.

This is not a borrower problem in such cases. Rather, it is about the restrictive nature of the lender’s structure.

Thirdly, there is typically a high-risk profile associated with unsecured loans. This is because no asset of any kind is pledged by the borrower as security. This is where unsecured loans differ from secured loans. You can click here to find out more about the distinction between both kinds of credit lines.

In light of the increased risk profile associated with unsecured loans, lenders are usually more thorough when examining the eligibility of loan applicants. In other words, applicants have to be very eligible to have their unsecured refinance loan request granted. By the way, some lenders are more lenient, while some are more stringent than others.

Can You Refinance with a Co-Borrower?

It is possible to apply for a refinance loan with a co-borrower. Doing so even increases the chances of such requests being granted. The reason is that co-application reduces the risk profile associated with granting refinance loans in the first place. This is why even people who are not ordinarily eligible may stand a chance with a co-borrower.

Having made this clear, co-borrowing is a serious financial practice and should be seen as such. As a result, it is a terrible idea to co-borrow with someone who is not financially responsible. The reason is that the actions of that person will negatively affect you.

For example, you would still be held accountable for unpaid loans even if you have paid your agreed share of the debt. In the same vein, you should make sure that your financial actions do not reflect negatively on your co-borrower if you get a refinance loan with a co-applicant.

How Long Before Lenders Respond to Refinance Loan Requests?

The response from lenders would usually come within a few minutes. The response would either be a granted request with a quote following suit, or a rejected request from a lender.

Technological advancement is majorly to thank for the quick pace at which lenders now respond to refinance loan requests. BankID is a prime example of how much technological advancement has revolutionized the credit market.

By the way, the quote by the lender; if the request is granted, is not binding. It would take the consent of the applicant before it can be binding. However, the offer as detailed in the quote would only remain valid for one month (30 days to be more precise). So, the applicant has to decide within this timeframe.

How Much Can Loan Refinancing Help You Save?

How much you can save when you refinance loans depends on several factors including:

Type and number of preexisting loans
Your credit profile
Lender

All of the aforementioned determines how much can be saved with debt refinancing. To provide a better perspective, let us discuss the aforementioned.

The type and number of preexisting loans matter because they determine the debt cost to a great extent. For starters, some credit lines are more expensive than others. For example, credit card debts can be very expensive with the average rate being around 25 percent. On the other, the average rate for refinancing is around 10 percent, which is 15 percent less.

Also, some people use debt refinancing for consolidation purposes. In other words, this is about merging various debts into one. The various interest rates and loan fees on all of the various credit lines also determine how much money debt refinancing can help you save.

Secondly, people with impressive credit profiles (especially credit scores) stand a better chance of saving a lot. This is because such applicants are more likely to bag improved loan terms, including very low-interest rates.

Thirdly, it is important to use the right lenders for debt refinancing purposes. This is because lenders do not offer these credit lines with uniform rates. Some are more borrower-friendly than others.

By the way, comparison platforms can play a huge role in helping you land the best refinance loan deals. You can visit besterefinansiering.no for more on this subject. Furthermore, loan agents can also be contacted for the same purpose. These are all in the bid to get the best refinance loan deals.

Conclusion

Several details about debt refinancing in a location should be known before applying for such credit lines. This is why this article has provided answers to some commonly asked questions on debt refinancing in Norway. So, make the right decisions going forward.