Mortgage loan, pawnbroker, loan consolidation, repurchase sales … there is a cascade of financial products that allows a household (or a single consumer) to come out of the “red” while recovering purchasing power . Do you know the repurchase of credits between individuals ? This financial solution is very recent and comes straight from our American neighbors. What does this finance operation consist of? Is it legal? Where to make this request? This post is focused on this new concept which is gaining more and more importance in France.
The repurchase of loans between individuals: understand this idea
Consolidating your loans with individuals may seem "weird". And yet, this new method of financing is very real. The principle is simple: an individual lends a certain amount of money to a needy individual without involving financial organizations .
Why such a concept? We have to be realistic, more and more French households are having financial difficulties, even if both people are working. There are many reasons for this slump:
- Life events that were not anticipated ( accident, disability, divorce, children's studies, dismissal, etc. ).
- Poor management of its budget.
- Excessive consumption of consumer loans for the financing of movable goods or personal projects.
- Compulsive or unnecessary shopping.
Whatever the reason, a situation must be found so that the financial balance is stable again and the cash flow becomes positive again. Credit redemption was born to help the indebted consumer. This concept offers the advantage of bringing together consumer loans in a single loan (some banks allow the consolidation of mortgage loans with consumer loans).
Unfortunately, another observation is to be deplored. Financial institutions are strict and do not easily grant loan redemptions. This is the case, for example, when an interested party is registered with the Bank of United States or if the interested party is a temporary worker who has no guarantor .
If financial institutions do not support indebted consumers, who can help them? Playing on solidarity between individuals is a possible solution.
How does the repurchase of loans between individuals work?
How does this process work? The repurchase of credits (also called loan without bank ) offered by individuals works on the same principle as the proposals made by banks with a few differences:
- Sign an acknowledgment of debt . The IOU is a document that certifies that a person has loaned money to another. This writing, which is signed by both parties, recalls the amount of the sum loaned, the terms of repayment as well as the duration (the individual can add interest). This document must be submitted to the records department of the tax service to obtain legal value. There are fees to pay (less than $ 150).
- Justify your identity . The individual lender is entitled to know the identity of the borrower. In fact, you are asked to provide a copy of your identity card or passport.
- Justify his domicile . The file is completed by a recent proof of address (less than three months).
Internet is the way to get in touch with a particular lender (beware of scams ). However, you should know that a repurchase of loans between individuals is generally done with a relative.
Is this offer of grouping loans between individuals really advantageous? This solution can be a good product if the amount of credits to be balanced is minimal. You should know that, generally, the individual who lends the money sets a limited period (less than 5 years).