Consumer credit without proof is consumer credit. Therefore, it is a depreciable loan whose amount can not be less than 200 €, nor exceed 75 000 €. Its repayment duration must be greater than 3 months, but the law does not provide, however, no maximum duration.
Consumer credit without receipts is also called the personal loan because to obtain a personal loan, the consumer does not need to provide any evidence on the allocation of funding to the financial institution that grants it. Indeed, he has the opportunity to use the credit as he sees fit, he can make a purchase, fill a shortfall, repay a credit, do work, finance training … This method of financing is very appreciated by Consumers, indeed, in the first quarter of 2016, consumer credit without proof was the consumer credit most used by consumers.
Legal obligations of financial institutions on consumer loans
Thus, financial institutions are required to include on all communication media, the words: “a credit commits you and must be repaid, check your repayment capabilities before you commit”. The credit institution has an obligation to inform its client. To do so, he must provide all the information related to his consumer credit without proof.
Thus, the customer must have the name and address of the financial institution with which he is getting into debt. Therefore, if for some reason he wished to retract, this information would be essential to send the withdrawal letter. The type of consumer credit must appear clearly on the credit offer, for consumer credit without proof, the mention will be a personal loan. Regarding consumer credit without proof in itself; the borrower must have the information relating to his loan such as the amount borrowed, as well as the conditions of the loan, namely, the repayment period, the number, the amount and the frequency of the installments. The application fees related to the opening of the credit line and the APR (Global Annual Effective Rate) applied to the loan must also be included.
The more specific information must also be available to the borrower
such as the possibility to postpone the deadline, the compensation in case of late payment, or in case of early repayment … If the consumer decides to prepay the financial institution, it will have to pay the same penalties as for all other consumer credits.
The prepayment allowance paid by the consumer may not exceed 1% of the sum lent if the remaining duration of the loan is greater than one year, and 0.5% if the remaining term is less than one year. As with other consumer loans, the extension of the deadline is possible because the borrower can benefit twice a year. But postponing the maturity increases the cost of borrowing because the deferral lengthens the term of the loan, and therefore the amount of interest paid.
All information regarding the offer of consumer credit without proof will be included in the credit offer, the issue of which is free. Legally, the loan offer that has been published, will be valid for at least 15 days, after this period, the financial institution will have the opportunity to change the terms of loan including increasing the interest rate. As with all other consumer loans, the customer has a withdrawal period of 14 calendar days.
The absence of justification in the allocation of the credit does not disengage the financial institution from its obligations, the financial institution will be obliged to make the checks with the Bank of France, to make sure that the borrower does not not included in the FICP (Personal Credit Credits Incentive File). This file gathers all the individuals having had a incident of refund on their credits. The registration for the FICP lasts 5 years, but when the individual regularizes his situation, his name is deleted from the file.
As for other credits, the consumer obtaining a consumer credit without supporting documents can take out insurance and choose the risks for which he wishes to be insured. The company issuing the credit will assess according to the consumer’s file, the need to ask him to provide guarantees to obtain consumer credit without proof. Thus, the financial institution can request a bond from the borrower. In this case, the person standing surety must also have a copy of the loan offer.
Where to get a personal loan?
But for this consumer credit without proof, just as for other consumer credits, the customer must complete the questionnaire of the lending institution. The questionnaire, whether filled in an agency or online, contains a certain amount of information. In the questionnaire, the borrower informs the institution about the amount he wants to borrow, and the length of time he wants to obtain. It also includes the applicant’s marital status, domiciliation and financial situation.
A consumer wishing to obtain a consumer credit without proof can turn to financial institutions specialized in consumer credit. He can also apply for a personal loan directly from his banker. If the offers of other credit agencies seem more interesting, he can ask his banker to make a better proposal. However, the consumer is entirely free to choose the institution that will finance his consumer credit without proof.
Today, the majority of financial institutions offer consumers to simulate their credit directly online. The financial institution with this simulation wants to attract consumers. This online credit simulation allows the consumer to compare different offers, and have an estimate of the cost of the line of credit he wants to obtain.
In addition to credit organizations and banks, the financial subsidiaries of many groups also offer consumer credit without proof. The consumer can also turn to an insurer to obtain a personal loan.
In addition, the borrower can also contact a broker. Brokers compare and negotiate credit offers for their clients. Their objectives are to provide their customers with the most advantageous credit offers possible. By appealing to a broker, the consumer hopes to be able to obtain conditions that he would not have been able to obtain alone, however, it will be charged by the broker for this service. The cost of this service varies from one provider to another, the consumer must be vigilant.
The main advantage for the client is to be able to benefit from a line of credit without having to justify himself to the financial institution that grants it. In the case of financing via a consumer loan without supporting documents, since the lending institution does not know the purpose of the financing line, it will not be able to ask the borrower for a personal contribution to the loan. get the credit line.
Financially, this credit has many benefits. On the one hand, the consumer can finance several projects simultaneously, without necessarily having to apply for a loan for each project. On the other hand, consumer credit without proof is much cheaper than the revolving credit, or the bank overdraft.
So with the personal loan, the consumer can realize several projects by controlling the cost of his credit.
However, even if the interest rate on consumer credit without proof is lower than the overdraft or revolving credit interest rate, it is still higher than that of the credit affected.
With this consumer credit, the customer is much less protected than with an assigned loan. Indeed, with an assigned loan, if for some reason the financed property was not delivered, or the purchase was canceled, then the funding would also be canceled. But, with the personal loan, the borrower should repay the financial institution. This is explained by the fact that when subscribing the assigned credit, the supplier is paid directly by the financial institution.
Today, the offer of consumer credit without proof is very varied. In the market, historically low-interest rates have helped lower the level of interest rates on consumer credit. Financial institutions are fighting a fierce battle to attract consumers.