When a borrower wants to redeem credits, there are several parameters involved in determining the total time of the transaction. The first important factor is the constitution of the file. The quality of it will play a key role, the more it will be complete and carefully present all the necessary supporting documents, the less time will be waiting to receive a response. In a second time, for the release of the funds is done as soon as possible, it is the nature of the repurchase of credits which will be determining. In fact, a buy-back of consumer loans is always faster than a buy-back with a mortgage, for example, which requires additional steps, such as going to a notary.
To constitute a file of repurchase of credits, most documents and supporting documents which will complete it can be photocopies. The original documents are claimed solely to validate the authenticity of the elements provided but also to support the analysis of the loan repurchase file. They are mainly claimed just before the release of funds for a control of use. The original documents are of course returned as soon as they are completed.
The best way to save time is to present immediately a solid file and especially complete, to avoid round trips that cause delay. If all the supporting documents are present in the file from the outset, the financial institution can begin its investigation quickly, without having to ask for the missing documents. Above all, we must play with transparency and not omit to add certain documents that could be unfavorable. The bank or financial institution in charge of the file will carefully study the application and the documents that will not be included in the file will be requested anyway.
The supporting documents necessary for the constitution of the file are generally: proof of identity, the last three payslips, retirement pension or declaration of turnover for the liberal professions, proof of additional income, the latest tax notice, proof of all loans in progress, other debts, pensions payable by the borrower, the last rent receipt or title deed. The complete file can be shipped and it will take a week or so to obtain a response in principle. As each file is different, a personalized study must be done to propose a financing solution adapted to each situation.
In general terms, the time taken to buy consumer loans (which includes personal loans, home loans, car loans, revolving loans, etc.) is shorter because is not necessary. The legal delays of reflection, of retraction are however unavoidable just as are the stages of the operation of a grouping of loans. On the other hand, since consumer credit is now more strictly regulated, lenders have the obligation to check the creditworthiness of candidates for the purchase of credits before any agreement. When the borrower uses a broker or an intermediary, it will put in competition the various market players in order to obtain the best conditions and the most suitable offer.
The answer in principle of the bank can be however rather fast, it arrives sometimes within a few days (between 3 and 5) according to the nature of the repurchase of credits. Even if an agreement in principle is given quickly, the bank can still request additional elements
If the funds can already be released after 7 days from the signing of the buy-back offer, most institutions prefer to wait until the legal deadline of 14 days has passed since 2014. The average duration of a Consumer credit buyback operation is a total of three weeks, between the initial application and the release of funds.
This is an operation that requires more time because the implementation of the guarantee is longer. The mortgage requires the drafting of a notarial deed, which is a formality to be carried out before the signature of the offer to buy back credits. In addition to this it is in some cases necessary to estimate the value of the property, which is a process that also requires time. For these reasons, the time to receive a finalized loan offer can be up to an average of one month. Once it is signed, it will be necessary to wait until the end of the withdrawal period and the release of funds, a step that can take another two to three weeks.
The response time of the lending institution
Once a proper full credit surrender file has been filed, the lender will proceed with its investigation. It is initially a serious and thorough analysis made by a committee of specialists internal to the financial institution. Once this mandatory period of instruction has passed, and all the supporting documents have been provided, it will take an average of ten days to reach an agreement. In the case of a repurchase of mortgage, this period can be lengthened since the lending institution needs to know the value of the property, for that it must carry out an expertise of the house or the apartment.
Once the buyout agreement has been obtained, the lender will propose a financing offer. It is not binding until it is signed, and even once signed, it is always possible to retract within the legal period of 14 days for consumer credit and 10 days for real estate loans. The deadline for accepting or rejecting the offer has been set at 10 days. In the case of a mortgage repurchase, if the notary executes the transactions quickly, the waiting period may be shorter.
The borrower can also play the watch by taking the time to study the offer of redemption. Care must be taken to analyze every detail, from the repayment period to the monthly payment, including the total cost and the cost of the borrower’s insurance.
The Lagarde law of May 2011 states that the withdrawal period for an offer to buy back consumer loans is 14 days. The retraction procedure involves sending a registered letter with acknowledgment of receipt. Generally, a withdrawal form is present in the credit buyback agreement received. No compensation can be claimed by the lender, as no justification for the reason for withdrawal is necessary.
When the funds have been made available before the end of the legal withdrawal period, the borrower has a period of 30 days to return the funds collected, to which he will have to pay the interest calculated over this period.
For a repurchase of mortgage, the borrower has the right to renounce his commitment within a legal period of 10 days.