Popular in the United States, the repurchase of credit between individuals has also found resonance in France. With this new system, individuals no longer need the intervention of a bank or other financial institution. Lender and borrower can carry out a transaction without an intermediary. However, there are conditions to be respected in order not to fall under French law. And you also have to be careful to avoid scams on the Internet. So what is really the grouping of loans between individuals? Principle, operation, advantages, disadvantages, methods, procedure to follow… We tell you everything about this new economic model which appeals to all social classes.
What is the repurchase of credit between individuals?
The repurchase of loan between individuals is a new system making it possible to consolidate all of its credits in progress without the intervention of a bank or a body of collection of loans.
The transaction takes place between two individuals. The two people must then agree on the terms of the operation: loan repayment period, interest rate and amount to be loaned.
As in the context of a repurchase of ordinary credit, the borrower must repay a single monthly payment to his lender. The repayment period is then spread over time so that the amount of the monthly payment is reduced. The borrower then benefits from an increase in his purchasing power.
The collection of loans represents an effective solution to have more cash or finance a new project (purchase of a new car, renovation work in the house, financing of the studies of the children…). And it also makes it easier to keep accounts. By having only one monthly payment to monitor instead of several, the borrower is less likely to find himself in a delicate situation (rejection of direct debit, agios, etc.).
How it works ?
The repurchase of loans is carried out without a bank or any other intermediary. The credit transaction is carried out only between two natural persons. Moreover, it is a revolution in the banking sector.
Simple to set up, the repurchase of credit between individuals however requires the formatting of a loan contract. The lender or the borrower can draft it. And it must be signed by both parties so that the operation takes place under the best conditions.
Loans not contracted with banking organizations must also be the subject of an acknowledgment of debt, a contract drawn up by a notary or by an organization recognized by the State, or certified by the Banque de France. Without this condition, the grouping of credits between individuals cannot be effective.
When the two parties agree on the conditions of the credit consolidation, the lender makes available to the borrower the sum of money necessary so that he can pay all his creditors.
To know : the money lender between individuals must be of legal age, but also never have lent money before. This last point is crucial in order not to fall under French law, which would then consider the individual as a banking establishment. It is therefore advisable for the borrower to ask the lender for a written certificate that he has never lent money in the past.
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The strong points
The repurchase of loans between individuals concerns both the middle classes and the other social classes. The only condition: not to be banned from banking or registered with the Banque de France.
From a financial point of view, the operation is advantageous because there are no bank charges. And in terms of time, the repurchase of credit takes place as soon as possible. Indeed, the funds are released within 48 hours after acceptance of the file.
As far as the lenders are concerned, they also have the possibility of making their money grow by recovering a percentage of the sum lent in interest rate. In addition to helping a person, it makes their money profitable. Today, more and more people with savings prefer to invest in credit redemptions between individuals rather than placing their savings in less and less profitable accounts.
What to pay attention to?
If the grouping of credits between individuals seems to have many advantages, it also has some limits. First, there are scams on the Internet. Before subscribing to a buyback of credits between individuals, it is therefore necessary to take precautions by avoiding people who pretend to be credit platforms between individuals.
On the other hand, the lender takes a risk by carrying out a collection of loans between individuals. Even if the non-repayment rate is very low, there is however the risk of never recovering his money if the borrower is not solvent. In case of dispute, it is advisable to turn to a judge to decide. This may incur additional charges.
Finally, the purchase of credits between individuals excludes people who are in a delicate financial situation. Indeed, banking prohibitions as well as files at the Banque de France (FICP, FCC) cannot benefit from this new economic model.
Repurchase of credit between individuals: approaches
The first step is to find a money lender for his credit redemption. To avoid disappointments, it is advisable to register on specialized sites. Be demanding and do not trust the first lender that comes along. This must be serious for the transaction to take place in the best conditions. Be aware that most of the time, credit redemptions between individuals are carried out with relatives.
Then, whether your lender is someone you know or not, you have to do an acknowledgment of debt. This written document, signed by both parties, includes all the terms of reimbursement. It must be filed with the registration center at the tax service in order to have legal value.
On the other hand, the individual lender must prove his identity by providing a copy of his identity card or his passport, and justify his residence (supporting document of less than three months).