The personal loan is there to allow you to realize your projects whatever they are without being forced to put money aside and that for years to save the sum corresponding to your project. In the financial market, there are two kinds, the affected one and the unaffected one.
The difference between the two is that for the first you have to produce a proof of purchase and for the other no. Otherwise, the terms of the contracts taken out with the bank are almost similar and we must honor its debt to its end.
Principle of personal loans
According to the legislation in force, the amount of money borrowed must be less than or equal to seventy-five thousand Euros, and subscribed for an equivalent period or over three months, not exceeding 60 months. The credit company must inevitably be a bank subsidiary recognized by the Bank of France and whose surname appears on the bank agents file.
The personal loan proposes a non-evolving rate of indebtedness according to the cash borrowed and the durability of the loan. The personal loan is payable monthly based on a depreciation schedule previously prepared by the banker.
Each total amount of maturities includes both a portion of the financing capital and the bank intermediation margins.
In France, personal credit online has been a real success for some time and is mainly due to its freedom of assignment in the form of the famous unallocated personal loan.
Applicants borrow some money they need except for the purchase of real estate. They are usually employees of the private sector, civil servants , TNS …
The reason is that for the purchase of a home, the repayment period is longer, the fixed rates can not be consistent with this kind of loan.
To qualify for any of these personal loans, you must be eighteen years old, not be on file at the Bank of France and guarantee the bank that your income allow the subscription of the loan.
The only drawback is that since the plaintiff does not provide proof of purchase, and if he has a problem once the bill is paid, the borrower must still pay his debt until the end of the payment. this.
Obligations in terms of personal loan
Since the Lagarde law , promulgated on July 2, 2000 and introduced to improve the security of subscribers, banks are obliged to incorporate the various theories presented in their proposals.
Nevertheless, these elements notified on the contract can not in any case be reconsidered during all its duration.
This allows to be protected through the regulation of consumption. The purpose of this regulation is to improve the quality of information and the absolute transparency of advertising proposals and propaganda concerning personal credits.
On the other hand, each agreement must include highlighted and highlighted texts re-stating all essential clauses of the loan such as:
- the credit style,
- the total sum requested,
- the exact repayment time of the loan,
- the arrangements for allocating the money borrowed,
- the sum, the quantity and the durability of the monthly payments to be honored,
- the nominative rate awarded,
- the rate over the actual and total year,
- the total amount of the loan including all charges related to the launch of the loan agreement,
- Obligations and compulsory insurance generally,
- remuneration for the notary,
- the seller’s explicit invoice stipulating the particularities of the property acquired and its cost when joining an assigned personal credit.
If you choose to take out insurance from the lender , the duplicate must be given to you at the same time as the proposal and the explanatory document. The APR must comply with strict instructions and its calculation is notified to the Official Journal since February 3, two thousand and eleven.
The unallocated personal credit
The unassigned personal loan provides both flexibility and security. The major interest of this loan is therefore its great flexibility since the plaintiff is completely free from the way of spending the borrowed money. He has the cash granted by the credit agency as he sees fit.
Therefore, no proof and proof of purchase are required by the bank, and the steps are necessarily simplified. Then, as the number of monthly payments is stopped at the moment of the notification, this specific loan grants more protection than for that of the revolving credit for example.
Indeed, for this type of credit, there is no limit in time since the money is reconstituted as and when repayments. Unfortunately, it is sometimes at the origin of very serious financial situations leading the borrower directly to over-indebtedness or to the repurchase of credit contrary to the unallocated personal credit.
Having said that, there is still a big disadvantage regarding the unallocated credit. Since the bank does not know what money is going to be used, it wants to protect itself and for that it applies lower rates than the one of the affected personal loan. It is also called personal financing. Among the shopping opportunities, there are among others:
- the realization of work of improvement of the habitat,
- helping children to pay for higher education and housing,
- to materialize a dream whatever it is ….
To present a file likely to be retained it is necessary:
- have regular work and income,
- submit statements of account highlighting the seriousness and good monitoring of finances.
The advantages of comparing before subscribing
Before subscribing to a personal credit assigned or not, it is absolutely recommended to make an online simulation between the various banking structures. You really need to compare different low-cost personal credit proposals before committing. The answer is immediate and does not commit you to anything .
Whether online via the internet or visiting credit companies, offers are varied, attractive for some credit companies and disturbing for others. To begin comparisons, you must correctly fill out the simulation forms, taking care to answer all the questions, especially if your request is urgent .
Then and according to your stated criteria, your application will be analyzed and you will see on the website a list of banking subsidiaries offering personal credits. Thanks to the comparisons, you have all your time to view them and to select the one that corresponds to your expectations.
Finally, all you need to do is contact the financial advisor to arrange an appointment and build your file. Without these market studies, you would be lost and you would risk retaining the first credit company, whether it is interesting or not. You should not hide anything from your financial situation because the law recommends that you must not be already indebted for thirty three percent of your income.
Moreover, if this is your case, and even on the comparison site, you will get a negative answer especially if the lender is serious and responsible. The simulations will also allow you to choose the right bank at reasonable rates without asking for a personal contribution. This happens in the automotive field for auto credit .
Various tips on personal credit
When doing your comparative study:
- enter the APR as a single parameter instead of the nominal rate. Since it incorporates all credit-related expenses, it saves you the unexpected inconveniences that may arise during the repayment of your personal credit,
- have no fear to discuss with your financial advisor the debt ratio, especially that being already a customer at home and preferring to keep you, he will be tempted to give you a rate defying all competition,
- do not hesitate to take advantage of the advantageous offers made available to potential customers by all credit organizations,
- make sure to carefully review the description of the conditions listed on the credit chart and if the fees listed are legal (registration fees, file and insurance cost if it is mandatory),
- read all the clauses concerning the anticipated reimbursement formalities and any penalties to be imposed according to the current regulations. You should know that the law on credit allows you, according to your income, to pay you the remaining amount partially or totally before the end of it,
- then, apart from the loan itself, do not forget to evaluate the insurance that accompanies it in an attempt to simply reduce the overall total amount.
In summary, do not forget to take your time before concluding, to do your market research well before making your final decision. The important thing is to be aware that, first and foremost, a request for personal financing is a serious step and that you have to make sure that you repay your personal credit schedule to the end.