The repurchase of credit consists of regrouping its credits in only one. It is for this reason that this operation is also called a grouping of personal loans, a grouping of debts or even a restructuring of loans.
Indeed, each loan has its specificities. For example, you can hold a car loan at a defined rate over a period of 5 years in conjunction with one (or more) consumer credit (s) having a higher rate but for shorter durations, or even, in addition, a home loan. It is therefore difficult for you to find your way around.
How much does this or that loan/credit cost me?
The diversity of loans makes managing your finances complicated. With a repurchase of credit, you will group them all into one, with a single rate, over a fixed and regulated period. In France, purchase of consumer credits cannot exceed a period of 15 years; a repurchase of so-called “real estate” loans cannot exceed a term of 35 years.
- Return to summary of definitions
- How does a loan buyback work?
- Why make a loan consolidation?
- Who can redeem their credits?
- What credits can be redeemed?
- What are the stages of a loan buy-back?
What is the repurchase of credits?
Credit consolidation is also more commonly called credit repurchase or loan repurchase, or more rarely, consolidation or restructuring which is most often used when talking about debts. The loan repurchase is a financial operation that makes it possible to resolve a situation of high indebtedness.
The purpose of the loan repurchase is to decrease the total amount of the monthly payments, which allows having 1 single monthly payment much lower in terms of repayment. There is no magic, the more you decrease the monthly payment and the more you extend the duration of the repayment.
It used to be said ” buying back credit can reduce your monthly payments by up to 60% ” which is now prohibited by law so as not to influence the borrower wrongly. Loan consolidation consists of substituting one or more loans for a single loan.
This new loan will have a single rate and very often a fixed rate and much lower than the credits taken over, it will be a loan repayable and over a longer period. This loan operation is of course calculated according to the income of the borrowers, in order to leave them with a substantial living surplus than before the credit consolidation.
There are several types of loan buybacks
– The grouping of consumer credits
– The repurchase of mortgage
– Professional loan grouping
– The repurchase of purchase/sale loan often called to repurchase or the real estate portage
We have already mentioned what it is to buy back a mortgage and buyback consumer loans in the buyback tab.
On the other hand, the professional loan grouping as its name suggests is exclusively reserved for professional borrowers. It is a loan repurchase operation which makes it possible to reduce the monthly payments and to have a longer repayment period and better suited to irregular income.
It concerns the resumption of professional loans for the liberal profession, the manager of the company, the entrepreneur, the merchant, and the craftsman, the annuitant. Credit consolidation makes it possible to finance professional loans, debts such as taxes, URSSAF, VAT, supplier debts, etc.
There are different types of professional loans:
– the professional loan grouping: it is a loan that makes it possible to take over professional loans and debts, and which will be set up by the company’s bank or banks.
– professional leasing is a rental that allows you to finance capital goods or real estate with a purchase option.
– factoring: allows a commercial receivable to be transferred to another company that undertakes to settle your invoice in the event of non-payment on your part. This helps to resolve cash flow problems if this is lacking.
Good Finance will not intervene for a professional loan.