Consumer credit is the ideal way to achieve many projects, but obtaining it is very framed. The borrower and the lender must respect the various stages leading to the signing of the credit agreement.
Step 1: The choice of credit
The borrower must first define his needs. He may take advice from lending institutions or brokers when seeking credit, the lender must provide him with a standardized form detailing the following information:
- the details of the lender;
- the type of credit;
- the amount and duration of the credit, the APR (Global Annual Effective Rate).
This sheet makes it possible to compare and make better sorting among the different financing solutions proposed. With this information, the borrower can know the cost of consumer credit and make his choice.
Step 2: The loan application file
Once the choice is made, the borrower must put together a file for his credit application. This is to provide the lending institution with proof of its solvency by indicating its income, its expenses, its loans already in progress. If the amount of the credit is greater than € 3,000, it must then communicate its tax assessment and pay slips.
Step 3: Studying the loan application file
It is then up to the lending institution to determine whether or not it is granting credit. The lender verifies the creditworthiness of the borrower by analyzing the documents in the file and calculating the client’s debt ratio. The lender must also verify that the borrower does not appear in the credit reimbursement incident file with the Banque de France.
Step 4: The loan offer
If the loan application file is accepted, the credit institution submits an offer that specifies the terms of the loan:
- the amount and duration of the loan;
- the Global Effective Annual Rate (APR);
- the date of deduction and the amount of monthly payments;
- the total cost of the loan.
The borrower then has 15 days of reflection to take advantage of the offer. Once the contract has been signed, the customer has this time a 14-day cooling-off period.