Do you want to take out a new loan? Whether it is a car financing, a personal loan, consumer credit or a mortgage loan. Our brokers will have to examine a series of objective criteria to assess your ability to take out a new loan. Calculation of the debt ratio online.

And above all your ability to repay it without difficulty and without altering your budget and your quality of life.

Simulate your credit online

Among the few determining criteria that we will briefly recall in this newsletter, the debt ratio will most certainly be the determining criterion.

A brief overview of the question now

What are the determining criteria for obtaining a favorable decision on your credit application?

Our brokers will examine several key criteria:

• The first criterion will be to ensure your solvency: to do this, our  brokers will verify that your professional or other income is sufficient to allow you to repay the requested credit and those that are already in progress;
• Being hired under a permanent employment contract is very important;
• You will be asked to produce your last three salary slips and your bank account statements which prove that your professional income is indeed paid into your bank account;
• You will also be asked to declare all current credit contracts;
• It will be verified that you are not registered or that the  cancellation of your registration with the National Bank of Belgium is more than a year old;
• Our brokers will analyze your debt ratio.

What is the debt ratio?

The debt ratio is the percentage that your financial commitments (debts, outstanding credits) represent in relation to your total income. It is calculated using the following formula:

Total of your debts or due dates to be repaid monthly / the total of your monthly income X 100 = ….%

For example : Mr François Castel is employed in a service company. He receives a monthly net salary of €2,750. He pays each month: €1,250 for his mortgage loan, €350 for his car financing and €278 for a personal loan.

His debt ratio therefore amounts to: Total of his monthly expenses = €1,878 / total of his professional income = 2,750 X 100 = a debt ratio of 68%

Analysis of the debt ratio

To obtain new credit, the debt ratio must evolve within a range going from 30 to 50% maximum.

If the candidate borrower does not own a home, the debt rate cannot exceed 40 %.

On the other hand, if he owns a home, the debt rate can reach 50% maximum.

In the example of Mr. François Castel, he will no longer be able to borrow because his debt ratio of 68% is much too high.

Are there alternative solutions?

Of course when a person repays several loans taken in isolation, it is always desirable to carry out a credit consolidation so that you only have one credit.

In the case of Mr François Castel, our brokers will carry out a credit consolidation as part of the mortgage credit which will allow Mr. Castel to only repay a single monthly premium which will be much less than the accumulation of the three premiums taken in isolation.

Thus, via a credit consolidation, Mr. Castel’s total premium will amount to €1,450. This represents a debt ratio of 52%, which could allow subscription. A small additional credit which will be included in the same and single credit.

Do not hesitate to contact our brokers for more information…

Do you want to deal with an unforeseen event but you don’t know what the maximum debt rate is? Whether for consumer credits, real estate loans, current credits, repurchase of credits. Or consumer credit. Cpe helps you at all times and takes your borrowing capacity into account. Depending on the financial situation, monthly net income, alimony, whether or not you have a co-borrower.
Simulate your credit online

This morning we are addressing an important aspect of your credit application: guarantees. In certain cases, the borrower will have to provide security for his credit request. Sometimes, this is the obligatory signature of your spouse or your partner. In certain cases, the guarantees presented by the borrower could prove insufficient and the credit application would then necessarily have to be accompanied by additional guarantees. In the area of guarantees: we will distinguish between real and personal security. In a second part we will deal with the assignment of debts and finally we will end with the guarantee. This trilogy of articles will give you a synthetic and complete view of the concept of guarantee in terms of credit.

The concept of guarantee

The activity of lender is of course not without risks: when the lender cannot repay its debt, the bank could incur a loss. Furthermore, it sometimes happens that a customer does not provide all the guarantees required for a loan and that it is necessary for a third person to sign alongside them (spouse, cohabitant, parents, guarantors).

The function of guarantees – also called “securities” for the lender – is to reduce the financial consequences of the risk of insolvency of a debtor customer. It allows him to recover all or part of his debt.

Legal forms and advertising

Most security interests require legal forms of creation and disclosure measures. For example, a free guarantee, that is to say, a third person who commits to your side requires the drafting of a guarantee contract separate from the credit contract. Likewise, the creation of a mortgage (real security) requires a notarial deed (authentic deed) and is registered with the Registrar of Mortgages. Failure to comply with these formalities can completely destroy the value of a security interest.

Types of guarantees

We distinguish between real security and personal security:

• Real security interests relate to one or more specific movable or immovable assets. For movable property, we generally speak of pledges and for real estate, we mainly refer to mortgages.
• Personal securities involve the engagement of a third party, a person who serves as security. These are essentially the sureties.

Match your credit application with a guarantee

A customer who has submitted a credit application may sometimes be initially refused: in this case, it may turn out that the solvency guarantees presented by the customer are insufficient.

In this case, our brokers will look for solutions with you:

• Thus, for the case of a married couple under the regime of separation of property: if one of the spouses wants to take out a loan to purchase property of their own, they may be asked to attach the signature of his husband;
• Likewise, the borrower could add the recourse of a third person as personal security.

These guarantees will be likely to fundamentally change the profile of the borrower’s file and thus can usefully promote acceptance of the credit application.

Our next part: the assignment of receivables (assignment of remuneration)

To facilitate decision-making when granting loans, banks and credit organizations are increasingly using “credit scoring”. This tool makes it possible to assess the risk of non-reimbursement based on qualitative and quantitative data collected beforehand.

What is credit scoring?

Developed around twenty years ago, “credit scoring” was designed to help banks sort credit application files based on a pre-established framework. Concretely, it is a questionnaire which makes it possible to define the profile of the borrower. This form seeks to collect all the information concerning him, namely his marital status, his marital status, his professional life, his income, his assets, etc.

This information allows the bank to quickly know if its client is one of the people at risk in terms of credit. The score obtained by the borrower from the information in the questionnaire will determine whether it is possible to grant him the credit he is requesting or not.

Use of credit scoring by lending companies

The main concern of a credit organization is whether its client is able to repay their monthly payments. It is therefore necessary to avoid granting a loan to a person who risks not honoring the deadlines by establishing the profile of defaulting borrowers. To do this, it uses its own statistics (case of large banks and important financial institutions) or it purchases databases from specialized companies (case of small banks).

The bank then draws up a questionnaire containing all the information likely to determine the borrower’s profile, awarding different points for each response. Even if the basic principle is identical, each type of credit often has its own questionnaire and rating. The borrower receives a score for each of their responses. The banker simply calculates his client’s total score to determine whether he is one of the people at risk in terms of credit or not in order to consider granting or refusing the loan.

You are currently married and you would like to take out a consumer loan or a mortgage loan. Perhaps you would like to take out a loan alone or together. What are your rights and obligations when signing a credit contract?

Can I sign a consumer loan or mortgage loan alone or on the contrary am I obliged to sign with my husband or wife? An update on these important questions which essentially relate to the choice of your secondary matrimonial regime

Simulate your credit online

Some notions about matrimonial regimes

The matrimonial regime is a set of rights and obligations which will govern the personal and property relations of the spouses with each other and of the spouses with regard to third parties, particularly in terms of financial commitments.

The law distinguishes between the primary regime and the secondary regime:

The primary matrimonial regime

This regime is provided for by law in the Civil Code and applies automatically and imperatively to all married couples in Belgium. It is therefore impossible to deviate from it. The primary regime essentially aims to define the rights and duties of spouses between themselves as well as to ensure the protection of the family’s main home.

The secondary matrimonial regime

This regime organizes the relationships between spouses and third parties, particularly from the point of view of financial commitments. We distinguish between the legal regime and the conventional regime.

The legal regime is the community regime. In this regime, the spouses remain the sole owners of the property and assets that they owned before their marriage. On the other hand, all property acquired during the marriage is presumed to be common unless the spouses declare otherwise. Likewise, goods received by inheritance remain owned as well as those made by declaration of re-employment following the sale of own property. In the absence of a secondary matrimonial regime chosen by the spouses during a marriage contract, it is this regime which will automatically apply to the spouses.

The spouses also have the possibility of deviating from this legal regime by adapting another form of secondary matrimonial regime during their marriage contract: example: the regime of separation of property or the regime of community reduced to acquets.

The application of matrimonial regimes to consumer credit

The primary regime

The primary regime defines some imperative principles:

• Each of the spouses contributes to the expenses of the marriage according to their abilities;
• Any debt contracted by a spouse for household needs and the education of children is common and jointly binds both spouses for all of their assets.

The legal secondary regime known as the “Legal Community”

In this regime, we distinguish three assets:

• The husband’s own assets;
• The wife’s own assets;
• The joint assets of the spouses.

Each of the spouses manages their own assets alone except with regard to the own building assigned to the family’s main residence (the owner spouse must have the agreement of his or her spouse);
Simulate your credit online
Common property meets the principle of concurrent management, that is to say that each of the spouses can carry out an act alone and carry out all management acts. However, the debts contracted by each spouse in the interest of the family are common and they involve all three assets.

There are exceptions to the principle of concurrent management: certain particularly important management acts require the signature of both spouses:

• Take out a consumer loan;
• An installment purchase;
• The purchase, sale, mortgage of a building;
• The assignment, pledging, lifting, receipt of repayment of a mortgage debt

In summary regarding the legal regime

• Each spouse can carry out daily activities alone for the needs of the household or the education of the children. thus, a spouse can take out a loan alone intended for household needs and the education of the children;
• In practice, however, credit institutions and companies will require the signature of both spouses;
• In any case, the debt is common and recoverable across all assets;
• In terms of consumer credit, installment purchases, mortgage credit: joint signature is required with no exemption possible.

The conventional secondary regime for the separation of property

In principle, each spouse can act alone for the management of their own assets. On the other hand, all establishments and credit companies will require the signature of both spouses to avoid subsequent discussions regarding the nature of the debt intended or not for the needs of the household and the education of the children.

For more information, we invite you to contact our brokers.
Simulate your credit online

Especially not. If you submit several credit requests to different brokers, your request will probably be refused because the Personal Credit Center will consider that they are different credits.

Life is often full of unforeseen events: a car accident, one of your children doing something stupid, property work that takes longer than expected or that generates additional costs.  You suddenly have need money quickly. Is this possible and how long will you have to wait to get cash in your bank account?   

Simulate your credit online
A quick update to the question….

How quickly can I get cash in my bank account?  

Do you need money quickly?  Don’t believe the ads that tell you that you will have your money within 5 minutes…or the same day. You will have to wait a period of three days minimum , to get your money, which in itself is already fast.

How does this happen? 

Very simply. You contact one of our brokers by telephone or you enter your demande online. After collecting all the information, our broker submits your request to one of our financial partners. We can get the principle response within a few hours.

As soon as we have a positive response, we will make an appointment with you in one of our  agencies to give you information about your credit contract and to proceed with the signature. 

We check all of your supporting documents.

As soon as the contract is signed, it is sent back to our financial partners. Like any bank transfer, you will have to wait between 24 and 48 hours  for the money to actually be in your current account.

Is there an amount limit to get money quickly? 

Absolutely not. Everything will depend on your contributory capacity, that is to say the quality of the guarantees you offer. This will take into account the number of credits you have outstanding, the amount of your salary, the quality of your mortgage guarantees free of charges, etc.

What supporting documents do I need to provide? 

When signing the credit contract, our brokers will check: 

• Your identity card; 
• Your residence card (for foreigners residing in Luxembourg); 
• Your last three pay slips; 
• Your bank account statements into which your salary is paid; 
• Your property titles; 
• Credit computer systems make it possible to check whether or not you have outstanding credits and whether repayments are regular. We are informed immediately in the event of a dispute or filing with the National Bank of Belgium.   

Can I receive the money in cash?  

Absolutely not for security reasons. The borrowed money is always paid to you in a bank account.

When should I start repaying the first monthly payment?  

At the latest, one month after signing your credit contract. Your next monthly repayments will always be made before this same date.

Any other questions?  

We brokersa , are at your disposal…
Simulate your credit online