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When we find ourselves unable to regulate our expenses, the over-indebtedness commission presents itself as a possible end to our financial problems. However, there are intermediate solutions that allow you to avoid this procedure and deal with our debts. What are they ? Discover here the different possibilities to improve your financial situation and repay your credits more calmly.
Reduction of monthly payments via the consolidation of credits
The subscription to several loans is often the cause of financial difficulties. In fact, your monthly payments constitute additional expenses that you cannot ignore. When your loans pile up and your income is no longer enough to cover them, your debts will naturally get worse over time.
For avoid over-indebtedness commission, remember to consolidate your credits.
This operation allows you to merge your various current loans from a single establishment. In short, all your loans will be grouped into a single credit. This has the consequence of reducing the overall amount of your monthly payments (the duration of the single loan being extended). To get an idea of the various aspects of this procedure, contact a broker specializing in this type of operation: as such, do not hesitate to find out what Millenium-Financement.fr offers in terms of consolidation of credits, also sometimes called repurchase of credits. You will be able to find out about the various eligible loans.
The 33% rule for better financial management
In France, many French people choose to take out a bank loan. The amount borrowed is mainly intended for the realization of significant projects, such as the purchase of a house, the acquisition of a new car, etc. If this is your case, however, make sure you are able to repay your loan.
For avoid borrowing excessively, we recommend that you adhere to the rule of thumb of 33%. In other words, you must ensure that your debt ratio does not exceed the maximum threshold of 33%. Threshold recently increased to 35% for mortgage loans.
Therefore, a third of your income will be used to pay your monthly payments. While it is sometimes possible to exceed this threshold, we do not recommend that you venture there to protect yourself from a possible default of repayment. The higher your debt ratio, the greater the risk of over-indebtedness.
Renegotiating credit to better repay monthly payments
If you are no longer able to repay the amount of your mortgage, we advise you to renegotiate it. Note that a renegotiation transaction is profitable for you if the difference in rates is equal to at least 0.5%. This solution presents a great alternative if you have a higher interest rate than what is applied today.
Credit renegotiation could also allow you toincrease the repayment period of your loan. In this way, you could reduce the cost of your monthly payments and benefit from a lower rate, depending on the case. In order to find the best option available to you, we suggest that you make several quotes.
It is important to mention that this operation may expose you to additional costs, including compensation and administrative fees. Take them into account before renegotiating your rate. You could then judge whether this procedure is worth pursuing. Also consider renegotiate your credit with your current bank. Sometimes the bank agrees to waive said fees if you stay at their establishment.
The pawnshop to avoid new loans
In the event of financial problems, some are tempted to take out new loans to meet an immediate need for liquidity. However, we strongly advise against it, especially if you still have outstanding credits. In addition, taking out a new loan requires the creation of a file and the presentation of various supporting documents. It is not certain that you can be entitled to it.
It is better to turn to a simpler solution such as a pawnshop. Not only does this type of transaction not require solvency criteria, but it also allows you to get money immediately. It consists of pledge your valuables, such as silverware, jewelry, rugs, carvings, etc.
To do this, bring proof of address and your identity document. Then, deposit the objects to be pledged with the pawn shop service of the Caisse de Crédit Municipal. An expert will take care of estimating their value. Then, they will be kept as a pledge in a safe and, in return, you will receive a sum of money up to the estimate.
On this pawnshop, you will have to pay interest, the rate of which will depend on the amount received. The date and method of payment are, in principle, mentioned on your contract.