When credit conso goes to the savings booklet

In recent months, there has been a fundamental trend: many brands specializing in consumer credit are investing in the savings book market. Why these new offers on a particularly tight market since the reform of Lagarde law? Lite Lenders takes stock.

The first brand to offer its booklet offer was Rite Lenders in May 2011. Since then, many offers have followed. Yeslite Finance, Good Lenders and soon Cream Bank, all specialists in consumer credit, are also entering the savings book market.


Why this sudden craze for savings book offers?

credit loans

First, the dynamism of this market which attracts more and more savers looking for secure products. Thus, we note that the stock of booklets subject to taxation increased by 10 to 14% per month from January 2011 to September 2012.


New booklet offers by consumer credit brands

credit loans

The need to diversify their sources of refinancing. Indeed, in certain establishments, particularly those which are not linked to a banking group, the financial crisis has hardened the conditions of activity. For example, the case of Cream Bank: despite its good results and a very honorable level of equity, the Best Lenders subsidiary was impacted by the difficulties of its parent company, with the consequence of its downgrade by rating agencies. As a result, it was unable to refinance itself at acceptable rates on the markets, which nevertheless constitutes the key to its profitability. In order to be able to continue lending, GMP therefore benefited in October 2012 from a French state guarantee, amounting to $ 7 billion. In the process, she immediately announced the launch in 2013 of a tax booklet.


Great growth driver for credit brands

Great growth driver for credit brands

Good Lenders, the banking subsidiary of the hypermarkets of the same name, was especially known for its credit cards, although it also has a range of savings products (Life insurance, term account, etc.). At the end of October 2012, it launched its tax savings account, the Good Lenders Savings Account, with a rather high yield, ie 2.30% gross guaranteed, with a promotional rate of 5.4% for the first three months. The official discourse is that this new offer makes it possible to “meet the expectations of savers” who “want simple, available, secure and profitable savings products”. However, Cream bank also recognizes that “this new offer fully meets the objective of developing activities through the diversification of funding sources”.

We should also remember that the consumer credit market has experienced a sharp decline, particularly in the area of ​​revolving credit. The Lagarde law of July 2010 imposed a minimum amortization of the borrowed capital and a maximum repayment period, modifications which greatly limited the use of the products. According to the Association of Financial Companies (ASF), between April 2011 and April 2012, more than three million revolving credit accounts were closed. Under these conditions, the new savings account offers appear to be a good way to revitalize the activity of retailers dedicated to consumer credit.

Credit repurchase with mortgage


The repurchase of mortgage credit, exclusively intended for the borrowers owners of real estates, is a solution to regroup several credits and / or to reduce the monthly payments thanks to a lower interest rate or to an extension of duration of repayment. S pecialized in personal loans and the grouping of fixed rate loans between individuals, supports you to help you understand the challenges of such an operation.

Replace the mortgage

Replace the mortgage

There are two ways to buy back credit with a mortgage. A bank or credit institution can:

  • either replace the mortgage loan;
  • or make a grouping of credits with collateralization by mortgage.

The first situation is for borrowers who have taken out a mortgage. They previously mortgaged one or more real estate to take out a new loan and develop their assets. In this case, the repurchase of mortgage credit will simply replace the existing mortgage credit. In the event of financial difficulties, the bank will spread this new credit over a longer period, which will have the effect of reducing the monthly payments to be reimbursed each month.

Borrowers may also naturally want to take advantage of more attractive interest rates. Instead of renegotiating their loan, they can have it repurchased from the bank. The assets initially mortgaged remain as collateral for the newly granted loan.

The repurchase of mortgage credit thus differs from the grouping of real estate loans by the simple fact that a real estate is brought as collateral. The mortgage may concern both real estate already belonging to the borrower and the real estate for which the bank grants the loan. When he buys back his mortgage, the borrower also has the possibility of pledging not one, but several properties.

Consolidate credits with a mortgage

Consolidate credits with a mortgage

A mortgage loan repurchase can also aim to combine several credits with the mortgage concession on the property owned by the borrower. When the borrower has taken out a mortgage for the purchase of his main residence and a car loan, for example, he may have an interest in combining them. A single credit is then made with a single bank or a single credit institution.

But the organization in question can ask for a guarantee. In addition to having recourse to a family guarantor or a guarantee organization, the borrower can mortgage his residence in order to be granted a new loan allowing him to balance his budget.

Compared to the grouping of consumer loans, the repurchase of mortgage credit makes it possible, logically, to group together a much larger amount. It is for this reason that the bank brought to buy back the credits will guarantee the operation.

Note: what types of loans are affected by the repurchase of mortgage credit?

In addition to his or her home loan (s), the borrower can redeem almost all of his consumer loans, such as restricted credit, personal loan, revolving credit, life loan or bank overdraft.

How exactly does a mortgage buy-back take place?

How exactly does a mortgage buy-back take place?How exactly does a mortgage buy-back take place?

A preliminary study will be carried out by the bank to determine the feasibility of the operation. This will be done in three stages:

  1. Estimate of the amount of credits to be bought back and of the additional cash possibly requested;
  2. Assessment of the borrower’s financial situation (income, charges, possible contribution, etc.);
  3. Assessment of the value of the property (s).

The value of the property must obviously be sufficient to cover the loans to be bought back and, if necessary, the new loan backed by the grouping.

If in view of all these data, the bank considers the mortgage buyback operation feasible, place the next step: defining the rate that will be applied to the loan. This rate will be based on several criteria, such as the duration of repayment, the total amount of the loan or the amount of the contribution. To recap, the rate observed on credit buyout offers is none other than the APR (annual percentage rate). The reason is simple: this rate includes all costs related to credit, such as the nominal rate and administration fees.

More than 1 in 3 Belgians pays too much for his home loan

A third of Belgians looking for a housing loan are limited to a visit to their own bank. As a result, there is a good chance that they will pay too much for a loan for thousands of dollars. This is taught by a calculation from Lenders Bank , the comparison site for banking products, based on a survey by more than 1,000 respondents from the research firm Profacts. Lenders Bank is therefore the first to introduce a digital mortgage comparator that helps to save time and money.

A study by the Profacts research agency commissioned by Lenders Bank shows that almost one in three Belgians consults only one lender to find the right housing loan. Of the group that compares several banks, almost four in ten visit at more than two banks. A very small group of borrowers (3%) makes use of a broker.

“For one of the most important financial decisions in your life, you should compare as many lenders as possible,” notes William Vandeen, co-founder and manager at Lenders Bank . “If you don’t compare, you will miss out on a lot of opportunities to lower the rate of your home loan. Even those who visit two lenders are not yet doing their utmost.


Save thousands of dollars by comparing

home loan

By comparing loans you can quickly save tens of thousands of dollars, a calculation from Lenders Bank shows. For example, those who borrow 160,000 dollars – the average loan amount in our country – for the purchase of a home worth 180,000 dollars can save up to 39,000 dollars by choosing the cheapest player. The difference can further increase depending on the amount, the duration and the quota.

That leads to the necessary frustrations. The research shows that more than one in three people who make the effort to visit at least three lenders, experience the search for the cheapest loan as frustrating to very frustrating. This is in contrast to the group that visits only 1 lender and of which only 7 percent experienced that experience as frustrating. “The frustration may come afterwards if they discover that they pay too much by not comparing,” William notes.

Find a better home loan faster thanks to Lenders Bank

home loan faster thanks to Lenders Bank

With the launch of a new home loan comparator, Lenders Bank wants to offer an answer to these frustrations. The new comparator allows visitors to compare home loans in a simple and transparent way for free.

“The visitors get an overview of the entire market. Moreover, we display more than the posted rates. Our visitors receive personalized rates for eighteen lenders. Moreover, they can immediately see whether they are eligible for a housing loan, “says William.


Three weeks waiting for a loan

credit loan

This is in stark contrast to the time that people still have to set aside for a good comparison. Nearly half of borrowers who compare three or more lenders have to wait at least three weeks before they receive a final answer, the numbers learn.

“Moreover, the research shows that we can help a lot of people with a more conscious management of their finances,” said the manager of Lenders Bank . For example, many fellow countrymen do not know how much their loan costs. 23 percent of respondents do not even know how much they pay each month. Less than half know exactly how much they pay each month for their home loan.

Home there, but credit here …

Foreign trips to holiday resorts often end up with ideas about buying real estate in the city you are visiting.

Today, such decisions are not only made by the richest Poles, show business representatives, and celebrities, but also by people who want to either invest capital or are simply looking for a place for themselves in a united Europe.

Buying a house, apartment or flat abroad is easy as long as you have enough funds on your account, although it always has a lower or higher risk. What? In the case of fashionable in recent years as an investment direction of Bulgaria, such a risk is an uncertain legal status. Foreigners can buy real estate there, but this applies to buildings or parts of them. The purchase of land, however, is – similarly to ours – still subject to so many legal conditions that it is almost impossible …

You need to pay attention to the location of the property

You need to pay attention to the location of the property

The most attractive ones, i.e. in the coastal zone, must be checked carefully. A few years ago, the Spanish government decided to clean up the chaotic buildings. And here we find an analogy with our law. The strip along the coast is protected and should not contain residential or guest house buildings. This provision has not always been followed by developers and individual investors. That is why many properties are arbitrary in terms of law …

A similar situation is in the already mentioned Bulgaria, where the investment explosion on the Black Sea is largely based on the disregard by law developers, not only of building regulations but also of environmental protection and unique nature.

Therefore, if we decide to buy property in another country – it is best to contact companies that specialize in transactions in this market. First of all, they know the legal tips inside out, and secondly, we have an additional guarantee of security. The broker is insured against risk and in case of any failures, we can pursue our claims and try to minimize possible losses.

This is particularly important if you want to buy a foreign resident in a loan, because such guarantees may be required by the bank.

Where can you borrow money for such a transaction?

Where can you borrow money for such a transaction?

Crediting real estate located outside of Poland is not the easiest financial operation. All because no bank will establish collateral on such property. However, for those who want nothing difficult, because a good solution that will allow us to buy an apartment or a house abroad is to separate the purpose of lending from collateral for the loan.

The bank may grant a loan for the purchase of an apartment abroad, but only on the condition that the collateral for the loan will be another property located within the borders of Poland.

Financial institutions are reluctant to accept collateral on real estate located outside our country because it causes difficulties or inability to recover if the loan is not repaid regularly.

However, if we have a property in Poland that can be collateral for the loan (because it is not encumbered with a mortgage), we have a chance to apply for a loan to buy the property abroad. The banks’ approach to this type of transaction is also not uniform and each time the analysis of applications will be particularly thorough.

It is worth noting that in some banks there is also a restriction on the location of the real estate being the purpose of the loan and a housing loan, you can credit the purchase of real estate located only in Poland. This means that these banks will be able to grant loans, but only as a mortgage loan. The client receives funds for any purpose and it depends only on what they spend them on. The basic result that results from this means a significantly higher margin and interest rate, and thus also a loan installment.

By definition, these banks apply the same pricing conditions for loans for the purchase of real estate regardless of their location.

The location of the loan collateral is important


This property must absolutely be located in Poland. However, as a result of the analysis, the bank can always decide to apply a higher margin or lower the acceptable level of LTV (loan to value) due to the increased risk of such a transaction.

Due to the complexity of the transaction, such applications are considered particularly thoroughly and the final loan terms can be determined only after analyzing the complete set of documents. Therefore, in some banks, the decision on the final qualification of the transaction is taken only after a thorough analysis of all documents.

This means that depending on the location and the specifics of the transaction, other banks may also grant a loan for purchase at the price of the housing loan, and not as a mortgage loan.

If you buy a property located abroad, you may also want to take out a loan from a bank in the country where it is located. In this situation, the application is processed in accordance with local law and the procedures of the bank to which we apply.