The overall effective rate first responds to the legislator’s desire to protect the borrower. It is mandatory and must be included in the prior offer . It includes all the costs that go into the calculation of the cost , ie the nominal rate, the insurance, the guarantee costs and the fees.

 

Namely: the brokerage fees must appear in the Payday loan.

 

This is therefore the only reliable indicator for comparing loan proposals, provided you do not make any subsequent changes, which is sometimes the case thanks to the modularity of current home loans. Thus it is quite possible that a proposal with a low nominal rate is revealed after analysis of the Payday loan, more expensive in reality than a competing proposal with lower ancillary costs.

 

The wear rate

 

The interest rate must not exceed the rate of attrition set by the Banque de France. Each quarter, the central bank publishes the threshold of wear that sets the maximum limit. This rule therefore applies to the calculation of the overall effective rate and is assessed at the time the loan is granted.

 

Case of revolving credits

In the case of a revolving credit or a bank overdraft, the appraisal is not made at the time of the offer, as for a home loan, but on the closing dates for the collection of interest.

 

 

 

The elements that go into the calculation

Expenses that fall in the cost of credit

 

The nominal rate

This is the one indicated in the commercial proposal. It is generally non-insurance and corresponds to the percentage of remuneration that the lender takes.

 

In the amortization table, the interest portion of the monthly installment is calculated on the basis of a proportional rate, ie the nominal rate divided by 12. In the case of a home loan variable, it is the starting rate which is used for the calculation of the Payday loan. It is only given as an indication since it is impossible to determine the evolution of the reference indices in advance.

 

Loan insurance

After interest, this is the element that most impacts the cost of your loan . We advise you not to be satisfied with a tariff approach. Indeed, the choice must focus on guarantees. Read the documents carefully before committing yourself, especially the chapter on exclusions in the general conditions. You can compete and freely enter into a contract outside the bank if the guarantees are equivalent or superior.

 

Good to know: the inPayday loanration into the overall effective rate can be complex depending on whether the contribution of your insurance contract contribution is on the borrowed capital or capital remaining due.

 

Warranty fees

The cost of the guarantee depends directly on the type of coverage required by the bank. For example, a mutual guarantee or lien registration will cost less than a mortgage. Real collateral (IPPD and mortgage registration) are also more restrictive and require a release in case of early repayment.

 

Compare Payday loans from 2 banks

 

Fees

They are at the discretion of the lending institution and are used to cover expenses related to the constitution of the file and the risk analysis. They are of the order of 1%, capped according to the loan amount. Even if they do not have a great impact on the overall cost, know that they can be negotiated, especially if you subscribe to several banking contracts (savings, insurance …)

 

 

 

In the credit guide, we cover all areas related to borrowing. You can read each part independently and freely navigate from one page to another.

The information in the different chapters

The different forms of borrowing

The legal nature of a loan depends on its purpose . There are different loans and each of them has its own characteristics and regulations. All forms of credit are studied in our guide to help you understand how it works.

Interest rates

In this chapter, you’ll learn to thwart the trap of rate comparison. Indeed, a TEG is different from a proportional rate . And the lowest rate in the market does not guarantee you the best deal. The overall effective rate remains the best indicator for comparing the cost of credit.

 

Conducting a good negotiation requires the borrower to discuss each element of their file, ie the type of guarantee, fees or conditions of the insurance. Cost analysis is important, but a financing solution is only appropriate if it takes into account your family situation and your goals.

Redemption and restructuring

Redemption is a sensitive chapter. On the one hand, because those who resort to it are often in a very difficult situation (as is the case with most restructuring files) and on the other hand because the lack of transparency of certain pseudo-professionals must urge you to be very careful.

To avoid any mistake, we detail a process that consists in first meeting with your creditors to negotiate an amicable solution . If this step fails, the second step that we advise you requires filing an over-indebtedness file to the Bank of France. It is only as a last resort that we must consider buying back our debts from a specialized body.

Do not decide in an emergency even if your situation requires it to act as soon as possible. Take the time to analyze the banking proposals. Know that spreading your debts over a long period increases the cost sometimes very important.

Consumer loans

This chapter deserves special attention. The objectives of the guide are:

• To inform about consumer protection and the regulations in force.
• Explain the operation of the different formulas (personal loan, money reserve …)
• Help borrowers to beat the pitfalls.

We are also developing the most important aspects of the Lagarde Law, passed on July 2, 2010, the last part of which has been applied since May 1, 2011 and the Hamon Law in force since March 2014.

 

Loans between individuals

 

You will find complete information on the loan between individuals. In 90% of cases, the proposals lead to scams. We only detail the offers issued by organizations with state accreditation.

Money reserves

Widely criticized by consumer associations and in the crosshairs of public authorities, revolving credit is offered by network banks or their specialized subsidiaries, as well as by major retailers. The regulation is not strict enough and combining the cash reserve with a payment card presents obvious risks to low-income households. We detail the operation and provide you with all the useful advice.

The mortgage

 

The mortgage makes it possible to guarantee a loan, whether it is to buy a new property, to repay household debts, to carry out work or simply to benefit from additional cash.

In this category, the mortgage life loan is particularly suitable for borrowers who have ceased their professional activity, repayment occurs on the death of the borrower. It is offered exclusively by the Crédit-Foncier branch network. This formula however has 2 risks:

1. The heirs are aggrieved
2. The cost is particularly high.

Other organizations propose a different formula with the possibility of amortizing the capital as soon as the funds are disbursed. These solutions are a suitable response for retirees, even if it is necessary to be vigilant, because they diminish the inheritance and hurt the possible heirs.

Microfinance

Muhammad Yunnus gave birth to microcredit. In the seventies, this young economics professor in Bangladesh helps a woman, forced to borrow from a usurer every day the amount needed to make chairs, she resold to the same person down price.

In France, it is Marie Nowak who developed the activity. Today, many associations grant small amounts of financing to entrepreneurs who are excluded by banking networks.

Regulations

 

Unlike Anglo-Saxon countries and especially the United States, French law protects borrowers . Indeed, the public authorities have largely legislated and the regulation of credit makes it possible to protect against intermediaries sometimes unscrupulous. After the Neiertz and Scrivener Laws, the Lagarde reform and then the Loi Hamon reinforced the protection mechanisms, even if everything is not perfect.

The company

Business financing does not respond to rules that are very different from those of the individual. The risk analysis is simply more complex , given the uncertainties associated with the entrepreneurial condition and the economic crisis that has tightened the conditions of access.

The immo loan guide

You will also find a complete guide on mortgage lending that will help you prepare your financing study in the best conditions, to compare different banking offers, but also to negotiate the best conditions.

Here you will find all the useful information on regulated loans and on all home ownership grants issued by the state or local authorities. Simple simulators of use at your disposal. We also offer you several simulators, simple to use and particularly practical to allow you to perform all kinds of calculations: determine your borrowing capacity or your debt ratio, assess the notary fees or calculate the cost of credit.

 

Taking a loan is usually considered very easy. But in reality, this often looks very different, because the applications and procedures are often associated with a lot of paperwork that has to be dealt with here.

Online credit providers in Austria at a glance

 

 

Compare Current Loan Rates – Free Loan Calculator

Especially if the loan application is still made in the traditional way, quickly results in a piece of paper, because copies of copies must be made. Everything is much easier today, because a loan application can now easily be made online. But here are several things to consider. What needs to be filled in and what information can hide any stumbling blocks that need to be bypassed? Questions to which the loan seeker should receive an answer here.

How to prepare properly?

When making a loan application, the most important thing when preparing for a loan is preparation. Of course, everything depends on what kind of credit it is. A car loan, for example, requires different documents than is the case with a real estate loan.

In addition, self-employed persons also have to submit additional or other documents in the case of an online application than those of an employee. Thus, the essential documents that are essential for lending and that should be available in digital form are listed first.

For workers and employees

• a valid employment contract (preferably indefinite)
• Bank statements that document the receipt of funds
• a household bill to prove the address
• possibly a copy of the bank card
• a valid identity card or passport

For self-employed

• the bank statements of the last three months, which have adequate coverage
• The business registration
• the operating permit (if available and required)
• the approval (if available and required)
• Tax assessments of the last three years
• valid passport or identity card
• a household bill to prove the address data
• possibly copy of the cash card

In the case of companies, the articles of association are to be submitted in principle. This also applies to pure partnerships, which in themselves do not constitute a legal entity. It is irrelevant whether a company consists of 100 or only two persons.

 

Important: compare loan terms exactly

The path to credit – explained step by step

The way to credit should be explained here step by step. In this way, errors can be effectively avoided because the sequence of applications in the network is basically more or less the same for each bank. Only the contents differ to a certain extent.

1. Complete application

First, the application must be completed online. This usually begins with the master data of the person. This includes name and address as well as date of birth and places of residence. Another person who makes the application together with the main borrower will also be noted in this area. The following section now asks for the financial data. These should be specified as accurately as possible, because the lending will be faster in the end. As a good preparatory work, the numbers must be checked less costly on the basis of the submitted documents, a decision can be made much faster. Ultimately, the employer still has to be named.

For self-employed this step is omitted, here the application ends usually in the economic conditions but is designed a lot more extensive.

Note: All data on the finances or the employer are subject to proof!

2. Wait for credit check

In this step, the loan seeker can not do much business, because he not only gives his consent in the terms and conditions of the lender by submitting the application, but also gives him a license to query the data of the KSV.

If negative features are present, the contract can usually be rejected. Since the check for online applications is automatic, there are only right or wrong here. If there is no negative entry, the loan is usually confirmed.

With a single negative detail but then the cancellation is already. This process is excluded from human control. If you have any questions, you should contact the bank immediately, for example, if information is incorrect.

Note: The advance confirmation does not yet constitute a commitment for the awarding of the loan. It only shows that there are no reservations about the KSV.

3. Setting up the online account

As a result, the user can create an account on the server of the bank. Usually, however, this is done automatically based on the transmitted data, so that the customer only receives his access data.

This account is the control center for all transactions that result from the loan. It is important that the mentioned documents are uploaded here. These are then ready for an employee to examine. As a rule, the customer is informed about the status of the processing. Contracts can then be viewed and managed in this area.

Note: Important documents will still be sent in writing. Although these accounts serve the administration, the legislator prescribes the written form for the contract or supplementary documents, for example.

4. Identification

Here, the customer has the choice of whether he wants to opt for the identification in the traditional way by Identbrief or for the online system. Many banks now offer online identification through specialized companies.

For this purpose, a webcam connection with a company employee must be established. Here, the ID card is placed next to the face of the camera, so it can tell if it is the same person. In the course of this identification, a digital certificate is then created which replaces the signature on the contract. This is thus effective with identification by the customer at the same time.

Note: Identification is an encrypted connection. In addition, no further data is requested and there is also no storage of private information on the servers of the third-party company.

5. Authorization and conclusion of contract

As a rule, the borrower receives the loan approval by e-mail. But this is only an advance notice, because the real credit agreement is usually sent to him by mail. This is already verified by the digital signature and must be taken only to the files. Usually, the payout then takes place within 30 minutes to 14 business days, depending on what kind of credit it is.

Note: It should be noted that from the day of the withdrawal, it may take 2 to 5 working days before the money has been credited to the borrower’s account.

Is the application in the network safe?

As a rule, all banks’ banks are provided with appropriate encryption. This prevents third parties from intercepting and misusing the data.

The entire process, including all other access to the lender’s site, is protected by these technical measures. If a certificate is invalid, the customer usually receives a notification of the browser. In such cases you should then already check the information of the bank.

Can an online application be submitted to all providers of credit?

As a rule, an online application can be made anywhere today. This also applies to credit intermediaries or mini-lenders. However, this can not be used for all types of credit.

For example, if you want to have a building loan for the construction of a house, you still have to go to the bank in person, because this is a considerable amount of money that is not simply lent via the network. In addition, various documents must be viewed here and a plan must be drawn up together with the bank. Even large loans are usually not awarded in this way. Here is also an appointment with the bank required.

The Schufa is a powerful institution. It collects all information about us citizens related to our creditworthiness and payment history. Without positive Schufa information no one gets a loan from a German financial institution. But there is an alternative. Various direct banks on the Internet offer a loan without Schufa information.

Bad reputation mostly unfounded

The providers of these loans have a bad reputation. In popular opinion, they are often considered black sheep in the credit industry. But that’s not true. The way to lend is simply different than at your house bank. But even here, nothing works without collateral. The most important is a permanent job with a regular and traceable income. Its height must be above the German seizure limit. Condition is usually that this is a non-independent activity. For self-employed, freelancers and housewives a loan without Schufa information is hardly possible. Another reliable security that is readily accepted is the property ownership. The loan without Schufa information is always granted as a installment loan, which must be repaid in fixed monthly installments .

 

 

 

Clean up with prejudice

Another prejudice against the credit without Schufa information are the alleged excessive interest rates. However, as with any other loan, interest rates are based on the general interest rate. But they are always below the interest rates for a repayment credit. You do not have to calculate this yourself. A good source of information is the reference computers on the Internet. Here you can check and compare the different offers. So you can calmly consider and weigh before you make a decision.

In addition, pay attention to some of the features that allow you to check the credibility of the lenders: The loan offer should always be free of charge, as should the loan application. Providers who want to deliver the application documents by cash on delivery are untrustworthy. A telephone contact must not be possible exclusively via expensive telephone numbers. It is also very important that the company has its headquarters in Germany more information and news here 

 

 

 

 

In fixed assets, the impairment must be determined for tax purposes. This impairment is called depreciation for wear. The AfA is characterized by the income tax law. Although it is a form of depreciation , which is based on tax law, but there are different variants compared to the business depreciation. Depreciation, which is scheduled according to commercial law, is called deduction for wear. In the case of unscheduled commercial depreciation on fixed assets, a tax deduction for extraordinary wear and tear (AfaA) is used. Furthermore, there is the unscheduled amortization of current assets under commercial law, which is referred to as partial value depreciation and the collective depreciation (since 2008) according to § 6 Abs.2a EStG.

According to two factors , the deduction for wear depends on the amount of the production or acquisition costs and after the normal period of use.
The deduction can be determined in various ways. On the one hand the depreciation in constant annual amounts, the linear depreciation. Here, the annual amounts remain constant. The resulting acquisition costs of the asset to be depreciated are distributed evenly over the years of use. As a result, the amount to be depreciated annually is the same. Here you have to differentiate between depreciation percentage and depreciation amount. The useful life is prescribed by law.

There is also the depreciation after falling annual amounts, the declining balance depreciation. From the tax law, only the geometrical degressive deduction is allowed. This can be applied to movable assets from fixed assets, which are listed in a special directory. The only exception here is the depreciation of rented dwellings, because the degressive depreciation may also be applied here if the building application is submitted before 01.01.2006 and the legally effective notary contract has also been concluded before 01.01.2006. In the case of the declining-balance depreciation, a fixed percentage is deducted from the previous year’s book value. This percentage may not be more than 2.5 times the depreciation rate of the linear depreciation and may not exceed 25 per cent.
Intangible goods may not be depreciated in this way, but only after a linear or unscheduled deduction.

An AfA is also permitted for used goods. These are amortized over the remaining useful life. If the usable assets do not exceed € 150, they are considered low value assets and will be deducted accordingly. The remaining useful life of used cars must be estimated according to the law. According to the AfA table, 3 year old vehicles have a remaining useful life of 6 years.

 

Basic use

The use of mathematics in financial transactions has many applications in the economy and is sometimes very complex, especially in advanced techniques such as those used for financial markets.

In the field of credit and in spite of sometimes confusing terminology , the interaction between mathematics and finance in general does not pose any particular problem.

We will apply, from some tools used by the financial technique , to compare the proportional rate used by banks to calculate the interest of a mortgage and the equivalent rate that is usually used for investment transactions . The first, associated with the various ancillary costs, will make it possible to determine the TEG, which makes it possible to compare objectively the offers of loan

The different terms used

When you borrow, the proposal from your banker translates into an annual rate, while your repayments are made monthly, hence the notion of proportionality that we will see below that defines the proportional or periodic rate.

 

On the other hand, the return of a deposit on a regulated booklet that runs for several years makes use of the notion of capitalization (the vested interests in turn produce interest). From a sum obtained at term, called acquired value , it is possible to perform various discounting calculations and find the equivalent rate.

Good to know: be aware that in a year we count 360 days in the field of credit and 365 in the calculations on investment transactions.

The proportional or periodic rate

Definition

This is both the simplest form of use and the most common application since it is used to calculate a fixed rate and fixed maturity mortgage . Among other things, it allows you to edit a depreciation schedule and uses simple interest calculations.

Calculation

It makes it possible to report the departure (nominal) rate to a sub-annual period (less than the reference period). Thus, if we want to reduce it to the month, it suffices to divide it by twelve.

formulas

The proportional rate is based on simple interests. The calculations are made on the borrowed capital.

Formula for calculating a simple interest investment interest (generally for a period of less than one year):

Interest = original capital * annual tx * number of days / 365

Proportional rate formula for calculating a monthly loan payment

Nominal Tx * Duration of the desired period / 12

Example quantified for a 4.84% annual loan

(3.84 / 100 * 1/12) = 0.32%

Value acquired over a period of less than one year

Acquired value = nominal value + Interest

 

Equivalent or actuarial rate

 

Definition

This ratio is based on compound interest. He finds multiple applications in the context of financial investments and perfectly illustrates the old adage: “time is money”. It makes it possible to calculate the overall effective rate by including the cost related to the ancillary costs. We are interested in transactions for which interest is paid in arrears (or after-tax), ie at the end of the annual period (in the case of most financial investments).

Calculation

We will take a concrete application and check for example that a monthly rate of 0.5% is not equivalent to 6% annual.

formulas

tm is the monthly tx and ta is the annual tx:

1 + t = (1 + tm) 12 from which t = (1 + tm) 12 – 1

To know: the converse is also true: an annual rate of 6% will not give an equivalent rate of 0.5% per month.

Value formula acquired over a period of more than one year

with VA = acquired value, VN = nominal value, i = interest, n = period

VA = VN + (1 + i) n