A request to buy back credit is not a step to be taken lightly, and sometimes applicants are refused. What can be the reasons which direct the financial organizations towards refusal of repurchase of credit? Is there a solution to work around a rejection from the bank? Answers!
Loan consolidation: the main criteria that come into play
A bank can invalidate a loan consolidation file for various reasons. Among these, a file at the Good Finance, a too high debt ratio, and more generally, an inadequacy to the acceptance criteria. More details below.
Among the multiple explanations which can justify a refusal of a request for the repurchase of credit figure the file and in particular the file FICP, that is the National file of the incidents of payments. This lists all of the financial incidents encountered by individuals. This file is updated by the banks, but also by the courts as well as by the debt commissions. The FICP file can relate to various situations:
- loan repayment delays.
Being registered by the Good Finance is indeed problematic when applying for a loan and naturally explains why a request to buy back credit is refused. Note that the Central Check File (FCC) lists people who no longer have the right to issue checks or pay by credit card.
Too high debt ratio
A rejected credit buy-back can also be explained by an excessive debt ratio. It is indeed commonly accepted that it must not exceed the 33% threshold. Concretely, the monthly income of an applicant must represent at least three times the amount of the monthly payments of the loan to be repaid.
This situation can arise following a loss of income or an increase in monthly payments. In the context of a refusal to buy back credit justified by this debt ratio, it is possible to readjust the request so that the repayment conditions correspond more to the budget of the applicant (s). Also, extending the repayment period, at the risk of experiencing an increase in the interest rate, turns out to be generally the only alternative.
Inadequate acceptance criteria
As when the request concerns a new credit, the repurchase of credit is the subject of a study. The funding body checks a certain number of parameters before agreeing or refusing to buy back credit:
- the aforementioned elements (data sheets and debt ratio);
- occupation, level, and stability of income;
- family situation (age, number of children, etc.);
- outstanding credits;
- the loan concerned by the request.
If the applicants have accumulated the credits, if their professional or family situation is less favorable, the bank can signify a refusal of the repurchase of credit.
Refusal to buy back credit: a pitfall, not a fatality!
As destabilizing and discouraging as it may be – especially in the event of a multiplicity – the refusal of a credit buy-back by the bank, fortunately, does not constitute an end in itself. There is not a solution but several to restore the situation and finally have the chance to be able to redeem his loans. There are 3, mainly. If some are widespread, another is a little less…
Solution n ° 1: continue prospecting
Faced with a refusal to buy back credit, this is probably the most common solution. Comparators and simulation tools can greatly help, as can a broker. This professional can help you tie up your file, and thanks to his negotiating power, you will get better offers than if you prospect alone. The broker will also be proactive with his banking network, which will increase your chances of obtaining an agreement.
Advice: multiply the requests
Instead of using only one broker, solicit several! The process is free. You only pay if you accept the banking offer offered.
Solution n ° 2: file an over-indebtedness file
After multiple refusals to repurchase credit, it is sometimes the solution which is essential. Common in France, the filing of an over-indebtedness file implies, first of all, a study by the over-indebtedness commission. Each request is studied, even those from people registered with the FICP or the FCC. In the end, if your file is accepted, you will be offered a solution (or even several). You are free to accept it or not.
Solution No. 3 (less common): aim for the consolidation of loans between individuals
What if grouping loans between individuals was ultimately the best solution? Perhaps this approach will save you from having to file an over-indebtedness file. By knocking on the door of an online platform offering this service, like Good Credit, you are getting closer to the traditional banking model.
The principle? Your loans are consolidated without any bank intervening. The costs are therefore reduced compared to a banking establishment, which has a favorable impact on the borrowing rate. However, with a minimal rate, the risks of refusal to repurchase credit diminish, since your monthly payments will be lower.
A solution that deserves to be known! At Good Credit, we go even further. Our policy is at odds with traditional banking policy: we do not see why borrowers in difficulty would pay more, which is why we adapt the borrowing rate to their situation