A personal loan is a consumer credit not assigned to a specific purchase. It is a financial product that you subscribe to with a credit organization to carry out the project of your choice.
The characteristics of the personal loan
Its amount:
as with any consumer credit, the maximum amount of a personal loan cannot exceed 75,000 euros. However, some financial institutions may offer lower limits and different limits depending on the project you want to carry out.Its duration:
it is generally between 12 and 60 months.His reimbursement:
it is fixed and you know in advance the amount of the monthly payments for the duration of your loan.
What can your personal loan be used for?
As this is an unallocated credit, you can use this credit for the project you want:
- make a consumer purchase (household appliances, car, etc.)
- finance a project (birth, wedding, vacation, work, etc.)
- deal with an unforeseen event (need for cash)
Good to know:
The cancellation of your project does not lead to the cancellation of your personal loan contract. You are therefore required to repay it according to the conditions specified in your contract and you obviously have the sum borrowed to use it for another project.
How to choose your personal loan?
To compare the different personal loan offers, it's simple! Most credit agencies offer online simulators allowing you to find the offer that best suits your needs and your budget. The elements allowing you to understand if the offer is suitable for you:
the amount borrowed
- : this is the sum you need to carry out your project.
the duration of the credit
- : this is the number of months during which you repay your loan.
the APR (annual percentage rate)
- : annual rate combining all the costs linked to the loan. It measures the total cost of credit.
the total cost of credit
- : as its name suggests, this is what the subscription to the loan costs you in total.
the monthly payments
- : this is the amount you will repay each month.
the cost of borrower insurance
- : as its name suggests, this is what your credit insurance costs you if you took out one when you took out your credit.
The characteristics of the personal loan
The personal loan is a consumer loan intended to finance private needs , which do not relate to a commercial or professional activity.
It does not finance the purchase of real estate or building land, for example. In this case, you must take out a mortgage.
The personal loan is subject to the provisions of the consumer code when its amount is between €200 and €75,000.
The personal loan is taken out with a bank or a specialized financial institution. It is not necessary to justify its assignment : furniture, travel, party, household appliances, IT… The amount lent is made available in one go , by payment into the borrower's bank account.
