By granting loans to individuals , the banks run a huge risk. This is also the case for any loan. This is why not all borrower profiles have the same value with regard to banks. Banks favor applicants who have financial stability because they are safer to reduce risk by granting a loan repurchase to these types of applicants and are more reassured to be reimbursed in full within the expected term of the contract. Reason why the constitution of your file is a determining stage in the request for loan repurchase . It is through the dossier that you will highlight your strengths to put the odds on your side.
The criteria required to obtain a loan buy-back
The assessments are different from one bank to another, but however, they are all based on the same basic criteria for granting or not a loan repurchase.
– the age and situation of the borrower: the applicant must be of full age, be young and in good health to be more likely to obtain the loan repurchase. Couples in the process of divorcing cannot request a loan repurchase and it is the same for people without civil rights and foreigners with a temporary residence permit.
– creditworthiness: the total amount of the monthly payments must not exceed one third of the applicant’s income. For a homeowner with sufficient living space, a debt ratio of up to half of the income can be accepted.
– the guarantee: the applicant must offer a guarantee of repayment in capital, either a mortgage of his real estate, or a guarantee by a third party.
– financial stability: the applicant must be able to justify the regular income he receives. It is for this reason that public servants are more likely to obtain a loan repurchase more easily than the other applicants because they enjoy job security and regular and stable remuneration for life.
– the purpose of the credit buy-back: the operation cannot relate to gaming debts, professional property, the purchase of land only or rehabilitation work alone. The object must be personal.
Civil servants: a privileged profile of banks
The professional status of civil servants reassures banks and lending institutions. Banks therefore easily grant loan repurchase to civil servants and some even offer solutions which are specially dedicated to them. Civil servants can benefit from several advantages relating to the repurchase of credit, including the lowered rate, the cost of insurance, reduced transaction costs or guarantee. Or the fact of being exempt from mortgage guarantees for a repurchase of mortgage loans.