One of the most interesting features of the Cessione del Quinto is to be able to renew it and then renegotiate it before its expiry, in this way further liquidity can be obtained going to extinguish the previous loan. This must take place under certain conditions as specified in the Presidential Decree of 5 January 1950 n. 180 which regulates the provision of the assignment of the fifth for employees and pensioners .
After how much can I renew my Cession of the Fifth?
Renewing a Cession of the Fifth can only be done after paying 40% of the loan. So if you have funded in 120 months you can renegotiate it only after paying 48 installments.
The only exception can occur if the loan has a duration of 60 months and in that case you can renegotiate it even before the expiry of the two fifths (24 months) only with a new assignment having a duration of 120 months.
When I can renew a Cession of the Fifth, here are some examples
If I have entered into a loan for the duration of:
- 36 months after 15 installments
- 48 months after 19 installments
- 60 months after 24 installments
- 72 months after 29 installments
- 84 months after 34 installments
- 96 months after 39 installments
- 108 months after 44 installments
- 120 months after 48 installments
What are the advantages of the renewal of the Cession of the Fifth?
Renewing a Cession of the Fifth is usually a way to obtain new liquidity as with the new loan the bank or financial institution must necessarily pay the one previously subscribed and the difference between the new loan and the extinction of the old loan will be paid to the customer.
A further advantage can be a substantial reduction in interest by signing a Cession of the Fifth contract with minor interests compared to the old operation.
So it will be good to carefully check the difference in costs (refer to the APR) between the two loans to see if you are doing a good operation because often the new contract provides for a lengthening of the duration of the amortization schedule and it is good to go to compensate at least in part with lower overall costs. For example, if you are paying a Fifth Transfer with 12% APR and a residual of 72 installments if you make a renewal by extending the loan by another 48 months but with an APR of 8% you will get a a 4-year increase in duration but on the other a saving on the remaining 6 years of the previous loan.
Am I entitled to a refund by renewing the assignment of the fifth?
The early termination of the previous transfer of the fifth entitles you to the reimbursement of certain costs incurred in advance in the contract that were related to the initial duration of the contract. Going to close this contract early, the costs related to the residual duration must be repaid.
In the extinction count, in fact, you will certainly find the reversal of the interest not accrued but it is not said that there are the counts relating to reimbursements of other costs such as insurance policy (note that for employees there are two separate policies “Life Risk” and “Employment Risk” ) or commission costs.
In this case it is advisable to contact the financial institution to inquire about the procedures for requesting reimbursement for the insurance premium not taken and the costs of the bank / financial commission.
On the other hand, the so-called “Up front” costs will not be reimbursed, such as for example the costs of preliminary investigation or the cost of managing the case since they are independent from the duration of the loan.
Renew a Cession of the Fifth, our advice on it
DG Prestifin advises you in case you want to renegotiate the assignment of the Fifth to ask in advance the extinction count to the financial with whom you have the loan to calculate exactly what you could get by subtracting the new estimate and the amount indicated in the calculation . This is because the amount of the balance is not indicated on the new contract and you will probably have to trust the agent or bank operator who is instructing you.