Now you can Renegotiate your Loans

Due to the current global pandemic of the #COVID19 and other factors that have had a significant impact on the Nicaraguan economy, many people and many businesses could renegotiate the credit terms of their credit cards, vehicle credits, mortgages, SME credits and others would do very well.

Therefore, if you have not yet seen the latest rule published by SIBOIF (acronym in Spanish that stands for: Superintendence of Banks and Other Financial Institutions), in this article we will share what you need to know regarding what you can now renegotiate in relation to your loans.


Who can Renegotiate their Loans?

This rule issued last week establishes temporary credit conditions that financial institutions may grant to debtors of:

      1. credit cards,
      2. vehicle loans,
      3. personal loans,
      4. mortgage loans,
      5. credits for SMEs,
      6. among others…


For what purpose was the Loan Renegotiation Rule Published?

The purpose of the standard issued by SIBOIF is to establish temporary credit conditions that benefit the debtor taking into account the current economic situation.

According to the standard, the following modifications are allowed:

      1. defer quotas;
      2. extend the payment period;
      3. grant a grace period.


Regarding the Grace Period:   Financial institutions may grant initial grace periods of up to 6 months of principal and/or interest within the time-limit extensions that financial institutions grant to their debtors and same treatment may apply for credit card minimum payment.

The principal and interest fees of the grace period may be redistributed within the remaining period of the loan, within a different period or through a lump sum payment (balloon payment) at the end of the original term of the loan, according to the criteria of each financial institution.


Requirements to Benefit from Renegotiation of Your Loans

It is important to note that these measures will mainly benefit those who have kept their payments up to date. This is because, according to Article 4(a), any of the benefits granted may only apply to those credits which as of March 31, 2020 were classified as A or B (which refers to a delinquency of 30 to 60 days in arrears).


Finally, according to the SIBOIF standard, those who wish to take advantage of any of the benefits described in it should do so by December 31, 2020.

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