Take control of your future with the flexible Personal Loan

The Personal Loan, often called an Installment Loan in Belgium, is a form of consumer credit. Specifically, this means a lending institution provides you with a sum of money that you agree to repay through constant monthly installments (comprising a portion of the principal and interest) over a predetermined period.

Its main feature is its flexibility of use: unlike a mortgage (for a property) or a car loan (for a vehicle), you generally do not need to justify the specific purpose of your expense. This is why it is also known as an “all-purpose loan.”

It is intended for:

• Any adult (18 years and older) residing in Belgium or Luxembourg.
• Individuals with regular and sufficient income to handle repayments (employees, civil servants, self-employed individuals with stable income, pensioners).
• Those wishing to finance a variety of personal projects: purchasing furniture, home appliances, wedding or education expenses, vacations, small renovations not covered by a specific home improvement loan, temporary cash flow needs, etc.
• Those who do not wish to or cannot provide a specific guarantee (like a mortgage) for the loan.

The purpose of the Personal Loan is to offer a simple, fast, and transparent financing solution to bring personal projects to life or to cover significant expenses without unbalancing one’s monthly budget, thanks to staggered repayments.

For a Personal Loan to be granted, lending institutions assess your ability to repay the credit without putting you in financial difficulty. Here are the main eligibility criteria examined:

• Age and Residence: You must be an adult (usually at least 18, sometimes 21) and legally reside in Belgium or Luxembourg. An upper age limit for the end of the repayment period may also apply (e.g., 75 years).
• Repayment Capacity / Income: Stable and regular income is required. Generally accepted sources include: salaries (permanent contracts preferred, fixed-term contracts under certain conditions), income from self-employment (with a certain length of activity and proof of income), pensions, and income replacement benefits (unemployment, disability under certain conditions). Rental income may be considered. Your income must be sufficient to cover your monthly expenses (rent, other loans, living costs) AND the new loan’s monthly payment. Finally, job stability is a major asset; for fixed-term or temporary workers, a certain continuity of employment may be required.
• Debt-to-income ratio: This is the ratio of your total monthly charges (including the new loan) to your net monthly income. This ratio should generally not exceed 33% to 40%, although this can vary.
• Credit History / Listing: In Belgium, a check with the Central Individual Credit Register (CICR) of the National Bank of Belgium (NBB) is systematic. A negative listing (for payment defaults on other credits) can make obtaining a loan difficult, if not impossible. In Luxembourg, similar checks may be performed. A good history of repaying previous loans is a positive factor.
• Personal and family situation: The number of dependents, marital status, and housing situation (tenant, homeowner) can be factors in the overall analysis.
• Supporting Documents: You will need to provide documents to prove your identity, income, and expenses (ID card, payslips, tax assessment notice, bank statements, etc.).

The goal of these criteria is twofold: to protect the borrower from over-indebtedness and to allow the lender to limit the risk of non-repayment. Each application is analyzed individually.

The personal loan simulation is an online tool, usually free and non-binding, that allows you to get an initial estimate of the terms of a credit you could obtain. Here is how it works and the key information it provides:

How it works: The process unfolds in three main steps.

1. Entering parameters: You typically indicate the amount you wish to borrow (e.g., €10,000). Sometimes, the purpose of the loan is requested (although for a personal loan, it is often “all-purpose”). Some simulators may adjust rates based on the project (e.g., energy loan vs. various purchases). You also specify either the desired repayment term in months or years (e.g., 48 months) or the maximum monthly payment you can afford (e.g., €250/month). The simulator calculates the other variable.
2. Calculation by the tool: Based on your inputs and the lender’s current rate schedules (which can vary by amount and duration), the simulator calculates the proposals.
3. Display of results: The simulator presents one or more financing options.

Information provided (typically):

• The monthly payment amount: The sum you will have to repay each month.
• The loan term: The number of months or years over which you will repay.
• The APR (Annual Percentage Rate): This is the most important indicator for comparing offers. It includes the nominal interest rate (borrowing rate) AND all mandatory fees associated with the credit (e.g., processing fees, if any). It is expressed as an annual percentage.
• The borrowing rate (fixed or variable): The pure interest rate of the credit.
• The total cost of the credit: The total sum of interest you will pay over the entire loan term (Total amount repaid – Amount borrowed).
• The total amount to be repaid: The borrowed principal plus the total cost of the credit.

Important: A simulation provides an indicative estimate; the final offer will depend on the complete analysis of your application. It allows you to compare different options and is often the first step before a formal application.

This tool is essential for making an informed decision before committing to a consumer credit.

The repayment conditions for a Personal Loan (Installment Loan) are defined in the credit agreement and vary from one institution to another, but they adhere to a legal framework. Here are the main aspects:

• Repayment Term: It is set when the contract is signed and can range from a few months (e.g., 12 months) to several years (commonly up to 84 or 120 months). The maximum legal term may depend on the amount borrowed. A longer term means lower monthly payments but a higher total cost of credit.
• Interest Rate: Most often, a Personal Loan comes with a fixed interest rate, which guarantees constant monthly payments. A variable rate is rarer but possible; it can change and affect the monthly payments or the term. The rate is included in the APR.
• Monthly Payments: They are generally constant if the rate is fixed. Their amount is determined by the borrowed principal, the rate, and the term. They are debited on a fixed date.
• Flexibility and Options (may vary): You are legally entitled to repay your loan early, with legally capped early repayment fees. Some contracts may allow for payment deferrals under certain conditions (which extends the term and increases the cost). Changing the monthly payment is less common.
• Insurance (optional but recommended): A credit protection insurance may be offered to cover repayment in case of death or disability. Its cost is added to the monthly payment or included in the APR if it is mandatory.

It is crucial to carefully read all the terms of the credit agreement (especially the Standard European Consumer Credit Information sheet – SECCI/ESIS) before committing.

Yes, a Personal Loan can be a suitable and fast solution for urgent cash needs, but it should be approached with caution.

Advantages of a Personal Loan in an emergency:

• Speed of processing: The application can be started online 24/7. An in-principle decision can be obtained quickly (minutes/hours). After approval and signing, funds can be released within 24-48 business hours.
• Flexibility of use: The money is not tied to a specific purchase (e.g., urgent repair, medical expenses).
• No real collateral required: This simplifies and speeds up the process compared to a mortgage.
• Flexible amounts: Borrow an amount that matches your urgent need.

Points of attention and precautions in an emergency:

• Cost of credit: Do not overlook the APR. Compare offers, even quickly. “Ultra-fast” loans may have higher rates.
• Repayment capacity: Make sure you can handle the monthly payments. A loan is a long-term commitment.
• Check the conditions: Read the contract before signing, even if you are in a hurry (fees, early repayment).
• Alternatives: Check for less expensive solutions (help from a relative, emergency savings, arrangement with the creditor).
• Avoid revolving credits: For a one-time need, an amortizing personal loan is generally preferable to a revolving credit (which often have higher rates).

In summary, a Personal Loan is a viable option for an urgent need due to its speed and flexibility. Approach it with discernment, assessing your repayment capacity and the terms to avoid worsening your financial situation.

The Personal Loan (or Installment Loan) has several distinct advantages over other forms of financing:

1. Flexibility of Use (“All-Purpose” Loan): Compared to earmarked loans (Car, Home Improvement, Student) which are tied to a specific purchase and require proof, the Personal Loan gives you the freedom to use the funds as you wish, without proof of purchase. Ideal for multiple or undefined projects.
2. Simplicity and Speed of Procedure: Compared to a mortgage, obtaining it is much simpler and faster. No property appraisal, notary fees, or mortgage registration. A lighter application file, and shorter approval and disbursement times.
3. No Real Collateral Required (for standard amounts): Unlike a mortgage or a pledge, no real collateral is required for most Personal Loans. The guarantee is based on your repayment capacity.
4. Accessibility: Intended for individuals, its access criteria are adapted to their situation (employee, pensioner), unlike professional loans with specific requirements for businesses.
5. Predictability (often at a Fixed Rate): Mostly offered at a fixed rate with constant monthly payments and a defined term, providing excellent budget predictability, unlike revolving credit (often with higher variable rates and a structure that encourages prolonged debt). It is an “amortizing” loan (each payment repays principal and interest, and the loan is paid off at the end).
6. Transparency of Costs: Thanks to the APR and the SECCI/ESIS form, the costs and conditions are clearly presented, allowing for easy comparison, which is not always the case with more complex financing.

In summary, the Personal Loan is a versatile, quick-to-obtain solution, without the administrative complexity of other loans. It is ideal for financing various projects or dealing with unexpected expenses without touching your savings or providing proof of purchase.