Refusal to buy back credits: what to do?
The loan repurchase is an operation which consists in gathering all of your current credits to form only one. The idea is to reduce your monthly repayment, to find a certain ease of management in your finances, to make savings thanks to better financial conditions or even to generate additional cash to finance a project.
All types of debt are eligible for the repurchase of loans: home loan, personal loan, consumer credit, bank overdraft, etc.
But lending institutions need collateral. They therefore study your borrower profile to find out if you will be able to repay them. Thus, a bank can refuse your request to buy back credit. What are the crippling criteria for making a credit consolidation? Here they are !
What are the reasons for refusing to buy back credits?
Although the conditions for a loan buy-back keep evolving over time, in particular according to new commercial rules adopted and the strengthening of the regulatory framework, it is possible to mention the elements which lead to a refusal on the part of the bank. Among these grounds for refusal , we can cite the following cases in particular:
- a consumer who would be in a situation of prohibition to manage or presenting a file in progress near a commission of over-indebtedness of the individuals;
- a first credit consolidation having been completed in less than a year;
- a consumer who presents a compulsive buyer profile (especially when many personal loans are taken out at close dates);
- a borrower who fails to save and does not have precautionary assets;
- a consumer who is addicted to gambling and gambling debts ;
- a person who displays a high propensity to multiply credits, in particular revolving credits (revolving credits);
- a desired transaction in the context of a property development or property merchant;
- an entrepreneur in liquidation at the time of the credit buy-back request;
- a person who has no amortization of a mortgage;
- a transaction concerning a loan with outstanding payments;
- a person practicing in a liberal profession or as a self-employed person and whose last 3 balance sheets reveal a significant fall in the income of his business and / or a deteriorated financial situation (unbalanced balance sheet, cash deficit, reduction in the margin, etc.);
- a cash purchase before a divorce without mutual consent.
If the previous list is not exhaustive, we can already return the question to identify the elements which appear prohibitive for the access to the repurchase of credit but which in fact are not necessarily it. We can notably mention:
- a borrower whose debt level is already high before he requests a buy-back offer;
- a borrower who has suffered garnishments and notices to third-party holders;
- a borrower who activated the credit consolidation solution more than a year ago;
- a person weighed down by social and tax debts;
- an owner borrower who would be on file with the Agree bank;
- a consumer who displays direct debits.
If these elements do not automatically exclude the use of loan repurchase, it is important to keep in mind that it will still be more difficult to obtain financing from a banking organization.
What to do after a refusal to buy back credits?
Has your loan buyback application been refused? It is important not to lose hope. Indeed, from one banking establishment to another, the granting criteria and the risk policies vary.
Thus, a loan file refused with one bank can be accepted with another. It is for this reason that it is strongly advised to make requests to several credit organizations, whether they are traditional banks or specialized online companies.
A second possibility is offered to borrowers who encounter difficulties in obtaining a loan repurchase: using a broker. This, thanks to its network of partners and its knowledge, can be a simple and effective solution to obtain the desired funding.
Indeed, from his experience, he knows which banks to contact in the first place and how to best submit a funding request for it to be accepted.
Good to know: in the event of refusal to repurchase credits, the financial institution or the broker cannot legally charge any fees or penalties. This provision is provided for in the Murcef law of December 11, 2001. If fees had been collected in advance, the organization is obliged to reimburse the amounts collected to the borrower without any deduction.
Is it possible to buy back credits following a liquidation?
A judicial liquidation procedure is initiated when a company in a situation of financial fragility can no longer meet its deadlines. This collective procedure ordered by the commercial court consists in dissolving the company and selling its goods to pay the debts contracted with its creditors.
When analyzing the credit repurchase file, the banker is interested in the past of his client who may have lived in his professional life a liquidation. As much as the latter reports it himself since the advisor will always end up finding the information by questioning his background.
Above all, the client will gain time and a little confidence in the exchange with his advisor specializing in credit consolidation operations.
A recently declared bankruptcy is one of the crippling criteria blocking access to loan repurchases, especially if errors or management errors are brought to light.
You will have to wait at least until the publication of the notice of closure of the compulsory liquidation in the newspaper of legal announcements. In so doing, the company de facto loses legal personality, the liquidator proceeding to the removal of the company from the commercial and companies register within a month.
An older bankruptcy weighs less heavily on your borrower profile. The lender will be especially attentive to the current debt situation. On the other hand, if the closing of the compulsory liquidation is in progress, no possibility of obtaining a repurchase of credit is possible.
Is it possible to get a credit buyout with gambling debts?
A bank is interested in several elements to draw a borrower profile and gauge the confidence it can place. Income, wealth, seniority in an entrepreneurial or salary activity and the family situation are particularly observed.
To trust, a bank seeks above all reliable and therefore stable customers. As a result, all the spending addictions identified are as many handicaps or even barriers to accessing loan consolidation. Thus, requesting a grouping of credits when gambling debts are clearly visible on the bank account statements automatically excludes this candidate in the race to buy back loans.
Compulsive gambling depicts an unstable profile and an uncontrolled relationship with money. Lending organizations obviously track any form of dependence resulting in expensive drifts, a real slide towards over-indebtedness.
This is the case with gambling but also with other behaviors such as compulsive buyers. To have access to the repurchase of credit, it will be necessary to show white cred by presenting for example several monthly statements of bank account on which no levy of bookmakers appears for example in the case of the followers of sports betting, turfists or other players licensed by online poker.
Does the filing at the Agree bank block access to the repurchase of credits?
Yes, being prohibited from banking , registered with the FICP (File of incidents of payment of loans to individuals) is a crippling criterion if you are a tenant . On the other hand, this is not the case if you are an owner provided that your property is put as collateral and that your debt level decreases to 40% or even 45% after the operation.
Good to know : tenants on file with the FCC (central file of checks) have the possibility in certain cases of making a request for a grouping of credits likely to succeed favorably on condition of regularizing their situation.
- FCC registration occurs when a check issued by the person has been refused or when a bank card has been misused;
- registration with the FICP occurs when an incident of repayment of a loan (mortgage, consumer credit) is noted.
Filing at the Agree bank remains an obstacle to access to credit repurchase solutions but not an insurmountable barrier. The lender obviously consults its files. An inscription indicates a degraded financial situation, therefore a negative point in the balance at the time of the study of your file. However, some banks accept on condition:
- to own a property and mortgage it (mortgage transfer in the event of a mortgage loan in progress);
- have contracted payment incidents with a maximum of two lending institutions;
- for not having made a bad check greater than $ 2,500.
However, if it is possible for you, it is easier to resolve in priority the incidents in progress before requesting a buy-back of credits. For example, within the framework of a filing at the FCC, the borrower who regularizes unpaid checks very quickly benefits from a deletion of this entry in the national file.