The Main Causes of Refusal of a Credit Buyback

You have several ongoing loans: a car financing of €22,000, a mortgage loan of €158,000, and a personal loan granted for the renovation of your garden of €8,500, for example. What are the causes of refusal for a credit buyback? You are experiencing some administrative difficulties managing three monthly repayments and you are wondering if a buyback of your loans to achieve a consolidation would reduce the total amount of your monthly repayments. What could be the main obstacles to achieving these credit buybacks?

1. What is credit buyback?

The credit buyback aims – in a way – to perform a credit consolidation. In the example cited below, you have three separate monthly payments to make. By buying back the three balances of the ongoing loans, you will only have one loan whose monthly payment will be far less significant.

2. For what advantages?

Firstly, from an administrative point of view, you no longer have to think about paying your three premiums each month to different interlocutors. With the credit buyback, you only have one ongoing loan and one interlocutor. Then, it is quite obvious that the accumulation of three separate premiums resulted in much higher repayments than if you only had one ongoing loan, even if the amount of this loan is higher.

3. The main causes of refusal by a bank for a credit buyback?

• You will likely have difficulties obtaining a credit buyback if you are already in a contentious situation, meaning if you have not repaid your monthly payments on time. In this case, you will be listed at the National Bank of Belgium;
• Your banker will analyze your debt ratio, which should never exceed 35 to 40% of your monthly income;
• Your banker will take into account your credit repayment history;
• Your banker will analyze the quality of the guarantees offered to protect themselves in case of default;
• If you are married, both spouses must consent and sign the credit contracts.