Credit repurchase: who are the applicants in France?
Credit conditions have never been so favorable in France. This situation, linked in particular to the accommodating monetary policy of the Cream Bank , is accompanied by an increase in the level of household debt.
While the current low interest rate environment is prompting many individuals to carry out their purchase plans, a survey published on December 10, 2019 by Spin Lender shows that almost one in five French people has at least one consumer loan. The accumulation of credits can quickly weigh on the budget of a household, hence sometimes the interest of making a loan consolidation.
Who are the applicants?
In principle, the repurchase of credit, which consists of gathering several loans in only one, is addressed to any person having at least two debts and wishing to alleviate their monthly payments. Borrowers can also, through this operation, obtain additional cash to finance a new project such as buying a car or carrying out work.
According to a study carried out by Capital lender which received in more than 4 million requests for repurchase of credit in 20 years, in 2018, the applicants were mainly men (60%) aged 35 to 50 years. Most of the borrowers who used this solution were on permanent contracts (62%, against 18% of retirees, 16% of unemployed people and 4% of tradesmen).
Buying back credit has different advantages for borrowers
Reduced monthly payments
The grouping of loans makes it possible to reduce the amount of monthly payments in return for an extension of the duration of borrowing. The new monthly payment is adjusted according to the household income. In 2018, clients who used loan consolidation obtained an average reduction of 38% on their monthly payments.
Simplified budget management
In the framework of this operation, the credits in progress are settled by the credit repurchase organization. The capital due is grouped together in a new contract providing for the payment of a single monthly payment to a single contact. Borrowers thus benefit from better readability of their monthly budget.
The repurchase of credit can be set up with the aim of achieving, ultimately, savings by taking advantage of a better interest rate. This possibility mainly concerns personal and revolving credits whose rates are often high.
Fund a new project
Borrowers who wish to control their level of indebtedness while financing a new project have an interest in resorting to the repurchase of credit. This financing must nevertheless be subject to a prior study by the bank or a broker.
Avoiding a situation of over-indebtedness
Although it does not represent a miracle solution to the financial difficulties encountered by households, the repurchase of credit can make it possible to avoid the spiral of over-indebtedness thanks to the rescheduling of repayments and the lowering of monthly payments.
What are the characteristics of grouped loans?
The repurchase of credit can make it possible to group together consumer credits and in particular personal loans, restricted or revolving credits and bank overdrafts. Home loans can also be included in the transaction.
The study carried out by Capital lender indicates that 65% of French people only have consumer loans and 24% at least a mortgage. Only 5% declare having taken out at least 2 mortgage loans. In total, 31% of customers have a debt ratio between 40 and 60% and 20% have a debt ratio greater than 60%.
Regarding the amounts of credits grouped, there are significant differences depending on the status of the applicant. Indeed, for tenants, the average amount combined varies from 10,000 to 50,000 dollars. For owners, it is between 100,000 and 200,000 dollars, reveals the study.
The credit buy-back market has been developing for several years. Most households use this solution to return to a healthy financial situation or to save money. Faced with the multiplication of loan consolidation offers, an in-depth study of the borrower’s situation remains essential before any subscription. This allows the lending organization to propose an offer adapted to the needs of each person.
All our information is, by nature, generic. They do not take into account your personal situation and do not in any way constitute personalized recommendations with a view to carrying out transactions and cannot be assimilated to a financial investment advisory service, or to any incentive to buy or sell instruments. financial. The reader is solely responsible for the use of the information provided, without any recourse against the publisher of Best Bank Credit being possible. The responsibility of the publisher of Best Bank Credit can in no way be engaged in the event of an error, omission or inappropriate investment.