Are you in love with the latest electronic equipment in vogue? Is your apartment in need of a facelift? Stop looking for a financing solution! The answer to your project is consumer credit ! Accessible, flexible and inexpensive, it is available under different types of contracts that meet each client’s project. Consult your bank, your insurer or directly your commercial sign to subscribe to a consumer loan adapted to your financial situation.
Now better informed and more protected by French law, more and more consumers are resorting to this financing solution. Each project has a solution and a bank loan contract offering reasonable repayment terms and interest rates. Credit repurchase, early repayment, loan to two, payment in several installments, consumer credit adapts to your financial situation and your desires.
What is consumer credit?
Consumer credit is a bank credit intended for the financing of consumer goods, that is to say neither real estate nor professional destination. Consumer credit can only be obtained by individuals. It includes several sub-types of unrestricted loans such as the works loan or the personal loan and certain restricted loans.
Consumer credit, commonly called “consumer credit” has the distinction of being unaffected. It is not intended for the financing of a particular good or service, as the car loan is used for the purchase of a vehicle or the works loan for the performance of domestic or construction work.
It is, in general, subscribed by customers facing financial contingencies (health, family event, back to school etc.) or wishing to finance a personal project (travel, decoration, purchase of a particular property, studies). The borrowed amount can be used in several installments, for several projects. The lending institution does not require proof of project, unlike so-called affected credit such as car or motorcycle credit for example.
Consumer credit is derived in several forms, the main ones being:
The appropriations allocated. The purpose of these is to finance a certain good or service, defined in advance and requiring proof of project. Home loans, cars, motorcycles or certain work loans are assigned loans.
Personal loan. Find all the information relating to the personal loan, our advice and the opinions of Internet users on our dedicated page by clicking here.
Revolving credit. This type of credit has the distinction of being offered by commercial brands. Behind the proposal to pay in installments is a loan, so be careful! With a maximum duration of 1 year, renewable, it is a conventional credit, that is to say the borrowing of an amount by an individual from a bank to finance consumer purchases, without proof. Easy to obtain and without initial contribution, it constitutes a real incentive for consumption, or even over-indebtedness.
Free credit. Also offered by commercial brands, free credit is a zero-rate loan. The amount borrowed is the amount repaid. However, one must meet eligibility conditions to get this loan. All about free credit. Please note, a free credit gives rise to administrative fees or guarantee requests which can turn out to be high!
When a consumer subscribes to several credits, he has the possibility of carrying out a credit repurchase, that is to say of grouping all his credits under one thumb. The advantage of this approach is to have only one deadline, one monthly payment and one lender to whom to contact! Find all the information on buying back credit by clicking here.
Depending on the loan taken out, the loan duration, the amount concerned and the lending institution, an early repayment of the loan is not always possible, or advantageous. The early repayment is the repayment of part or all of the amount borrowed before the scheduled maturity. Get more information on prepayment.
How to take out a loan?
Do you want to take out a bank loan to finance one of your projects? Start by doing an online consumer credit simulation to determine the type of loan suitable for your project and its cost. Make an online simulation. Find out about the types of loans available to you: personal loan, work loan, car loan, etc.
Gather the necessary supporting documents in the loan application file to show your seriousness and motivation to your lender! You will need – in addition to the classic identity documents – a bank details, proof of address, even a proof of project etc. Click here to find the complete list of supporting documents.
The word in addition to the editorial: Remember to check that you meet the eligibility conditions ! Consumer credit is intended to be easily accessible, but banking or credit institutions can be cautious. Are you eligible?
The first element to consider is the type of loan offered by the bank or credit institution. Is it suitable for your project and your situation? Then it is recommended to consider the proposed rates, that is to say the interest rate (fixed or variable, its amount, etc.) applied to the term of the loan.
Finally find out about the terms of the contract, including the requirement or not of initial contribution, application fees, guarantees to provide, terms of end of contract or early repayment. It’s about leaving nothing to chance! Click here to view our page dedicated to consumer loan interest rates.
How do I know my repayment capacity before taking out a bank loan?
The repayment capacity of an individual is his ability to financially assume the monthly payments relating to a bank loan over the entire duration of the loan taken out. The borrower is invited to check this capacity before subscribing to a bank contract. The lender is – in any case – required to validate this capacity as well as to consult the National Files of Incidents and Repayment of Credits to Individuals (FICP files of the Banque de France) before granting or not a credit to a particular. The objective is not to refuse a loan to a potential client but to avoid any situation of over-indebtedness !
To find out if you meet the repayment capacity condition, the calculation to be made is simple / Compare the total amount of your annual income and the total amount of your expenses. Multiply your net income by 33% then deduct the charges.
The editorial bonus: Beyond a debt ratio of 33%, the client is considered to be over-indebted! Indeed if more than a third of his net income is dedicated to the repayment of credits, the customer is very likely to have big financial difficulties. And therefore to no longer be able to repay your loan (s).
The editorial boards
The team of company has consulted offers from banks, insurers and other credit institutions. We visited and compared the online simulations offered on the Internet. We now share with you the fruits of our research.
Do not neglect the work of information and comparison of the offers that we offer you. It will be more advantageous for you to take out a bank loan adapted to your project and offering you the most optimal possible conditions for its repayment.
Compare the offers of bank brands, consult the opinions of Internet users, compare with the offers of new players on the credit market (online banks or loans between individuals for example) in order to form an objective opinion on your loan. Leave nothing to chance! Make an online simulation.
Do not hesitate to use one or more simulation tools to guide your research.
Consult the various loan issuers and have a professional accompany you. He will be able to better guide your choice and negotiate interest rates or contract terms.
Find out about trends in the banking market, the price of your currency (euro, dollar, etc.) and interest rates. Borrow at the right time and at a reasonable rate! What are the interest rates offered?
A loan is a commitment. Be sure of your repayment capacity before taking out a contract and committing yourself.
Don’t hesitate to borrow a little more than just the purchase amount of the targeted good or service. We are not immune to the unexpected!
Negotiate the terms of reimbursement, cancellation or end of contract.
The law regulating consumer credit
Certain banking and legislative procedures regulate all types of consumer credit. First, any credit organization must inform the borrower of the terms applied to the credit and its repayment, the risks of over-indebtedness. They are required to remind customers of their commitments. The latter will also be offered a second credit offer, a repayable credit for example, so that he can compare the two proposals. Finally, the lender has a duty to inform and is required to check the creditworthiness of the potential borrower, and this every 3 years.
Consumer credit is regulated and strictly framed by French law. It was the subject of several reforms, in particular in 2014 with the Pinel law which aimed to revive the real estate sector in France by facilitating the financing of housing construction by individuals.
Thanks to a significant tax reduction and a facilitated credit system, the State encourages individuals to build new housing, intended for rental for at least 6 years, in order to revive the economy and allow more many become homeowners and build long-term capital.
At the dawn of 2017, the Hamon law reinforces this regulation and aims to better inform and protect consumers against the abuse of commercial signs. This law acts mainly on the daily life of households. It restores purchasing power to consumers to encourage the recovery of the economy through consumption and demand. Insurance, food, health, credits, guaranteed purchases, the consumer is now protected and reassured to consume in peace.
The editorial credit example:
You wish to redecorate the decoration of your main residence and estimate the cost of the works at $ 7,425. For safety and security, you decide to borrow a little more to deal with unforeseen situations. You subscribe to a personal loan of $ 8,000 over 12 months at a fixed interest rate of 0.95% excluding insurance and charges.
There will thus be 12 monthly payments of $ 670.07 and the total amount to be reimbursed will be $ 8,040.84. If you wish, you can get more information on credit work here.
How do you know which loan is best suited? We base this comparison on a quality-price ratio, the accessibility of the contract and its constraints.
- Personal loan. Classic, reliable and quick to obtain, this banking contract is the most subscribed by French households. Indeed, it does not require proof of project. The borrower therefore uses the amount borrowed when he wants, for what he wants, in one or more times! He is free to use his capital. Flexible, the amount of a personal loan is between 200 and 75,000 $ over periods adapted to each client (between 3 months and 7 years in general). Elected consumer credit number by our editorial staff, we invite you to consult our dedicated page to obtain all the information on this banking contract.
- Free credit. With such a promising name, one can only be very interested! This type of bank contract offers a zero rate loan, ideal for small budgets! In return, it requires reimbursement respecting deadlines and solid guarantees. Renowned for its reliability, it is very popular with customers.
- Revolving credit. Very accessible and quickly concluded contract because it is proposed, subscribed and often concluded directly in store, it constitutes an ideal and fast solution for large purchases requiring a small financial advance. With no initial contribution and renewable every year, this loan is regularly taken out by many consumers. But beware! Under its attractive attractions are hidden some unforeseen costs in the calculation of the customer. In no case is the contract signed with the commercial sign but with its bank. The contract therefore includes administration fees, warranty fees or reimbursement terms which are not always advantageous for the client. Do not rush on the first attractive commercial offer! Your bank can also offer you revolving credit at a reasonable rate.