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Do you need a deposit to get a consumer credit?

Verified 24 October 2019 - Directorate for Legal and Administrative Information (Prime Minister)

You do not have to have a deposit to obtain a consumer credit. But the bank can refuse to grant the loan if there is no bail. The guarantor is a person who undertakes to repay the bank in the event of the borrower's default. The guarantee must be made by a written contract, which sets out the conditions under which the guarantor must intervene. The lender is obliged to inform the guarantor of the extent of his commitment in an up-to-date manner.

The bank may require you to seek a deposit before granting you a loan.

The guarantor is a person who agrees to repay the creditor in your place, if you do not do so.

The level of commitment of the surety depends on the type of bond chosen: single or joint deposit.

  • In the case of a simple deposit, the creditor must first sue the borrower before going to the person who is suing.
  • In the case of a joint and several guarantee, the guarantor shall be obliged to pay the debtor's debt as from 1to payment incident. This type of deposit is generally preferred by banks.

Any natural person may be liable, even if he is not related to the borrower.

A legal person (specialized company, mutual health...) can also be surety.

However, you cannot guarantee a borrower who does not have the legal capacity (minor or protected major for example).

The deposit must be made in writing. It must mention the type of guarantee (single or joint), or else it will be void.

The guarantor must receive the credit offer by mail, as the borrower.

Consumer Credit Bond

The lender applying for a bond must verify that the surety has sufficient means to enter into the bond.

If the lender accepts a bond that is disproportionate to the guaranteed financial risk, he will not be able to ask him to fulfill the debtor's obligations. Unless the guarantor's situation has changed and has sufficient assets at the time when it must meet the guarantee obligation.

Obligation to provide regular information

The lender must notify the guarantor, before March 31 of each year:

  • the amount of capital outstanding,
  • the amount of interest, expenses and commissions remaining to be incurred on 31 December of the previous year
  • and the end date of his engagement.

If the lender does not communicate this information to the guarantor, the guarantor will only be required to repay the principal, without any overdue interest or penalty (i.e. due).

Obligation to indicate a regular APR

Credit institutions shall be required to disclose to the person who is surety a RATE: titleContent which includes all costs incurred by the loan.

In the absence of a mention of the APR in the contract or in the event of a mention of an incorrect APR, the judge may cancel all or part of the interest. In determining the amount of interest forgiven, the judge shall take into account in particular the damage suffered by the borrower.

The lender must inform the guarantor as soon as 1to borrower repayment incident.

If he has not done so, the surety shall not pay the penalties or interest for delay due between the date of this 1to incident and the date on which it was notified.

Denial by the guarantor of payment of late penalty/interest in case of late disclosure by the bank