Rest to live minimum: calculation for a credit
Risks of over-crediting yourself
The rest to live is what remains to a person after paying all his expenses. This amount of money is the first criterion banks take into account in determining the credit their client can obtain.
The rest to live is fundamental when making a credit
- Stay to live
- Debt ratio
- How to make a good credit report?
You have to understand the risks of over-crediting yourself and know your personal financial situation before you apply for credit. In this article, we will discuss several points that help to better understand his financial situation:
The knowledge of one’s financial situation is essential to build a good credit file, which will not have any problem to be accepted. This reasoning is valid for any type of credit, from real estate credit to revolving credit. A person in debt distress should be familiar with these definitions. Let’s clear this up, to prepare a credit report make an over-indebtedness file and personal recovery procedure
Calculation of the rest to live
The calculation of the rest to live is quite complex, if we take purely banking criteria. It varies according to where you live, the composition of the home and the bank. It is admitted that the rest to live minimum for a single person and without children is 700 euros, 800 euros if it is in couple (400 euros per person). There is interest in being in a couple, at two we save money. The amounts are increased by 300 euros per dependent. A couple with three children will have a rest to live of 1700 euros. If this family lives in the Paris region, the rest to live is increased by 100 euros per person, which makes us 2200 euros for our family in Paris.
These figures serve only as a basis for calculation, and may vary from bank to bank, from family to family. It is the study of your bank movements, your savings, which allows a bank to determine what is your left to live. A bank can for example consider that the rest to live minimum for a single person is 1300 euros! The credit institution may or may not take into account family benefits or taxes to calculate the rest to live.
Enterable amount and elusive quota
The over-indebtedness commission is managed by the Bank of France
Over-indebtedness is one of the greatest evils of our modern society. It is a difficult situation to live in, which requires a lot of sacrifices to get by. When you are an employee, one of those sacrifices is to give up a portion of your salary to the various creditors.
Each month, the boss pays directly to the creditors with a portion of the salary. The employee does not even see his money, which is used to repay his debts: this is called the assignment of salary. This assignment can be voluntary, it is the employee who asks that automatically the seizure of salary is carried out, or compulsive. Here, it is an order of the court or the commission of overindebtedness, which obliges the employer to pay part of the salary for refund of credit.
There is a part of the salary that can not be seized, there is always a minimum that is left to the employee: it is the elusive quota. The fraction of the salary that can be seized is it logically named the seizable portion. On some salary sheets, you can see these mentions. The elusive quota is calculated based on the remainder to be lived, and is added to the various elusive benefits that the person over-indebted could have.
In benefits such as the allowance for the young child, the parental allowance, the family allowances, the family supplement or the back-to-school allowance, can be seized within a limit of 20% of their total for the child. payment of debts. The housing allowance and the special education allowance can be seized to pay for health costs, education or for the payment of rents or mortgages. Other benefits are elusive and without a cap at 20%: health benefits death insurance, housing benefits, allowances for disabled adults.
Calculation of the seizable quota
To calculate the seizable fraction, we take the 12 months of wages preceding the notification of seizure. The remainder to live, minimum subsistence, must be at least equal to the RSA, increased in case of dependents. The scale for calculating is updated once a year, on January 1 st. It will be understood, the elusive quota often corresponds to the rest to live.
Takeover of credit to improve his rest to live
To carry out a refinancing file, a credit redemption, the banks look first and foremost at the rest to live, much more than the debt ratio. Here, the over-indebted person is forced to buy back his credits because he can no longer cope with his monthly payments. The only calculation that the person does at that time, and the banker too (or at least he should), is how much money will he stay a month after the payment of his debts. In other words, what will be his remainder to live. The repurchase of credit thus makes it possible to recover a reasonable rest to live, by spreading the debts over a longer period, there is less to pay each month. This solution should only be used if you really need more money to live each month, because each time you extend the payment period, you pay more interest.
In France, a credit file is simply the file prepared by a bank to give you credit, and which will be processed by the banker. Inside we put all the necessary documentation, like the pay slip, the last bank statements, etc. It is the treatment of this file which causes the expenses of file, even if as commercial argument, more and more banks propose the file of free credit.
If the rest to live is correct, a credit can be granted, even if the debt ratio is 35% or more. Each bank will have its own criteria. To develop a credit report, banks scoring: they “score” customers according to different criteria. This is the note that will determine the credit agreement, as explained on this related article.
The more complete and well-informed the credit file is, the shorter the file processing time will be, and the response will be more likely to be positive. This file is to be done once, and it is presented to different banks that we approach. In this file, it will be necessary to have the original elements, as well as the copies that can be left to the lender, the bank. If we are two to build a mortgage file for example, it will be necessary to put the documents of both, the borrower, and the co-borrower. A mortgage file is probably the most complete credit file, so we establish here the list of documents necessary to apply for a mortgage: with these elements, any other type of credit accepts your credit. folder. The more reassuring the lender is about creditworthiness, the more the lender can offer a competitive and advantageous interest rate.
Elements needed to establish a mortgage file
The first thing to do, before establishing a mortgage file, is to know what you can buy (by making a calculation of its debt ratio, its rest to live, by evaluating its possibilities of borrowing with a comparator), to find the desired real estate, and to have signed a promise of sale. It must therefore have in its file elements relating to the property that we want to buy, whether an apartment or a house.