Personal credit is a form of consumer credit whose capital is not allocated to a particular project. The borrower freely uses the funds made available by a credit institution. Explanations.
Principle of the personal loan
To cope with an imponderable, it is sometimes necessary for a household to have the necessary funds. However, if the amount of money required exceeds a few hundred or even thousands, it can be difficult to finance this expense without going into debt. Credit institutions and banks offer their clients personal loans. Personal loan is a form of consumer credit. By taking out this type of loan, a borrower will get the payment of the principal directly into his bank account. To finance a project to purchase household appliances, cars or renovations, the personal loan is particularly interesting because its interest rates are lower than those for bank overdrafts. According to the Lagarde law, the personal credit capital is raised to 200 euros. Its ceiling is set at 75,000 euros.
Characteristics of the personal credit
As indicated, the personal loan is attached to the person of the borrower. That is, it is not assigned to a project. With this type of credit, the borrower therefore has free capital paid into his bank account. In contrast to the credit allocated, the personal loan makes it possible to finance a project without justifying it with the banking establishment. Thus, it is easy to cope with an unexpected purchase such as the replacement of a vehicle or an electrical appliance. The personal loan can also be used to prepare a happy event or a family party. As with any credit, the lending institution will first analyze the borrower’s profile to determine if the borrower will be able to repay the personal loan. In addition, the lender may require loan insurance to be taken out by the borrower to cover the banking transaction.
Simulate your personal loan
Before taking out an unallocated loan, a borrower can get a first idea of the amount of repayment payments through the online credit line simulation. Simulating a loan also gives other indications to the applicant. He can thus know the possible duration of the loan. However, if the borrower is already repaying outstanding loans, he or she can turn to the loan consolidation. This banking operation allows to group several loans within a single loan and therefore a single monthly payment. The grouping or repurchase of credits is an alternative to the personal loan because during the assembly of the file the applicant can include the financing of a new project.