On this page we present what an interest rate check is. The purpose is to create knowledge of the concept of interest check and give an overview of what options you have for making an interest check on existing loans.
GET AN INTEREST AT YOUR LOAN
We explain, among other things, what advantages it has for you to check your interest rate if you have a loan. Because of the record low interest rates on consumer loans, there can be a lot of money to save just by checking your interest rate. There are many cheap loans with low interest rates. Therefore, we also show you how to easily check your interest rate with our new interest rate check feature.
If you are considering whether it is worth getting an interest check, or do you just want to know more about the topic, then you have come to the right place as we guide you through everything you need to know about interest checks.
WHAT COVER THE CONCEPT
In short, an interest check means that you are investigating whether there is a possibility to get your existing loan at a cheaper rate with another bank.
If you find that another bank can offer you a cheaper rate on your loan, you can choose to:
Thank you for the new offer and move the debt
Use the offer to negotiate a better rate with your current bank
If you choose to accept the new offer, your existing loan will be transferred to the new bank. With this you have got the same loan only with another bank and with a lower interest rate. You therefore end up having to pay less for your loan and thus save money.
You can also use the new offer to try to negotiate a better rate with your current bank. When the bank can see that you have been offered the same loan with a lower interest rate, it may be that it chooses to offer the same low interest rate to keep you as a customer.
Borrow low interest rates by choosing one of the two options. It is entirely up to you which option you choose. You are not bound to accept the loan offer, regardless of whether the interest rate is lower than on your current loan or not.
Even if you get a cheaper interest rate on your loan now, it’s still smart to make an interest check again in half or a year. Interest rates can change constantly.
AVOID TO PAY FOR MUCH FOR YOUR LOAN
If you suspect that you are paying too much for your current loan, you should consider making an interest check. By getting an interest check on your current loan, you can see if you can get a better interest rate on your loan from another bank.
If you get your loan with a cheaper interest rate, if the maturity is the same, you will receive a lower monthly payment on your loan. Therefore, you will eventually be able to save a lot of money. It may also be that it allows you to pay off the loan faster than you had expected.
At Lulu, an interest check is free and non-binding. So if you find that you already have the cheapest rate, it has not cost you anything – just a few minutes to complete an application. On the other hand, you can calmly lean back knowing that you have the cheapest interest rate.
CAN IT PAY TO GET LOW ONE INTEREST RATE
In February 2019, we launched our new interest rate check function. We want it to be easy for you to check whether you can get a better interest rate on your existing loan. And we already see that many of us save money by making an interest check.
How much each user saves by making an interest check varies greatly. It can be anything from a few thousand dollars to over 100,000 DKK, but the conclusion is clear. It may be worthwhile to get an interest check.
EXAMPLE OF INTEREST RATES
We have a lot of examples of users who have achieved huge savings. Here you can see an example of a couple who used Lulu to make an interest check.
Dorte and Lars have a loan of DKK 250,000 with a maturity of 7 years and an APR of 7.35%, which means that together they end up having to pay around DKK 320,000 including all interest and taxes before their loans are paid by.
They were convinced that they had a sensible APR on their loans. However, they chose to make an application via Lulu to see if they could get a better offer with a lower interest rate. They received offers from several banks and accepted a loan offer of DKK 250,000 with a maturity of 7 years and an APR of 5.19%. This means that together they end up having to pay approx. DKK 300,000 for the loan, which is a saving of approx. DKK 20,000 just by examining the market.
Anna has a loan of DKK 448,000 with a maturity of 10 years with an APR of 15%, which means that, overall, she must pay around DKK 861,100 including all interest and taxes before her loan is paid off.
Anna found out that by making an interest check at Lulu she could check if she could get her current loan cheaper from another bank. She receives offers from several banks and accepted a loan offer of SEK 448,000 with a maturity of 10 years and an APR of 3.9%. This means that Anna overall ends up having to pay approx. DKK 541,797 for the loan, which is a saving of DKK 319,303 just by examining the market.