Loan consolidation is an increasingly popular way of optimizing debt among Czechs. It is currently considered by almost 60% of people with two or more financial commitments. However, the classical consolidation of individual debts is reaching its limits, as most Czechs do not have more loans to consolidate. Financial companies therefore offer the possibility to unite partners or the whole family into one loan.
A Bankil survey among 525 respondents showed that 6 out of 10 Czechs do not have loans and credits that could be unified. Such a high number has several reasons. “Although the consolidation of loans has been operating in our country for several years, many people still do not know that it is possible to consolidate in addition to traditional consumer loans, for example, credit cards or overdrafts. Some do not even realize that they actually have debts that can be consolidated, ” says expert, Bankil’s Sales and Marketing Director.
Another reason is that a large group of borrowers have already consolidated loans in the past. And last but not least, there are many people who actually have only one loan. “However, we often encounter situations where more loans within the family come together, even though none of the family members have more than one loan,” adds Manny.
Ignorance hinders interest
Therefore, it is gaining in popularity the possibility of uniting the liabilities of the whole family into one more advantageous loan. According to a survey, 43% of Czechs would now use this option. The real interest may be even higher. One fifth of the people are hesitant and others have not yet received any attractive offer of this type. Although some companies have been offering family debt consolidation for at least two years, more than a tenth of people also admitted that they had never known about this possibility. Most companies do not actively promote it.
Some arguments against family consolidation also show low awareness. E.g. 8% of people do not believe that this can be significantly saved. “In practice, partner consolidation can be more advantageous than a classic individual. In the Czech Republic, it is possible to achieve an interest rate of up to 2% lower than that of individual consolidation, ” says Manny from Bankil.
But interest increases every year
The opportunity to save money is interesting for Czechs. The increasing trend in the case of interest in consolidation is confirmed by comparison portals specializing in loans, which provide clients with offers from more financial institutions. “People are increasingly interested in the possibility of consolidating loans in various life situations, alone or with a partner. According to our statistics, the interest in consolidation has almost tripled year-on-year and the increase in the volume of real-time consolidation compared to 2016 was over 50%. We expect that the growth in interest in both individual and partner consolidations will continue to increase, ” says financial expert of the internet comparison portal Saverlife.