In France, since 2012, over-indebtedness has been declining. Since 2011, the number of over-indebtedness files has dropped from 232,493 to 181,123. Several elements are mentioned by banks, such as the end of the crisis, or the empowerment of consumer credit, or the Lagarde Law. from 1 July 2010.
However, since 2005, there has also been an overall increase in consumer credit and household debt , according to the Banque de France. Here is a quick explanation of these conflicting figures.
A decrease in the share of consumer credit in the over-indebtedness files
In France, the amount borrowed as consumer credit has increased from 115 billion euros in 2005 to 165 billion euros in 2017. This increase goes hand in hand with the increase in real estate loans and has increased since 2015. Despite this fact, the share of consumer loans in the over-indebtedness files went from 53.8% in 2012 to 37.4% in 2017. Moreover, the number of over-indebtedness cases including consumer credit has gone from 90% to 80%.
This is, in several articles, attributed to the success of the Lagarde law of 2010, which aims to reason the consumer credit. However, the number of cases only started to drop in 2015, five years after the Laguarde law came into force.
A decline in over-indebtedness files submitted
In 2014, 230,000 files were submitted. The decline therefore does not occur from 2012 (232,493 files), as some articles argue, but from 2015. This means that the main change does not come from the Lagarde Act, which was intended to moderate the consumption credits, but the LAW n ° 2013-672 , entered into force in 2014.
This law allows the over-indebtedness file declared admissible not to go through the amicable resolution. The decision whether or not to attempt a mediation resolution between the creditor and his debtor is decided by the commission of overindebtedness of individuals . Thus, from 2014, the number of conventional plans concluded was halved , while the measures imposed by the commission went from 57000 to 97000, at their highest level, in 2015. It is therefore a question of a deterrent measure for those who wish to file their debt overhang, because the good faith of the debtor has a large influence on these decisions, including the ability he would have had to avoid being in a situation of over-indebtedness. In 2017, only 23% of receivable debt in debt was erased. This measure becomes more and more dissuasive, since in 2018, the recommendations of the commissions no longer need to be approved by the judges .
The counselors of Hoist Finance, Intrum justicia, always in touch with subscribers of consumer loans
Hoist Finance, Intrum, EOS and other credit recovery companies continue to see the reality: consumer credit underwriters are still in an effective debt distress situation. However, their files are no longer received and processed by the commission.
Indeed, a study has shown that the French who resort to consumer credit indebted themselves more than their European neighbors . However, the situations in which the recovery files are favorably treated are the cases where the debtor is a victim, either because he has fallen prey to predatory credits, or abusive, or because he has experienced an unforeseen that has changed radically. his financial situation (bankruptcy, accident, unemployment). However, only 27% of the over-indebtedness cases are unemployed, which explains somewhat the decline in the number of cases treated favorably in 2017.
Among the common causes mentioned in over-indebtedness files, besides unforeseeable causes, such as accidents or unemployment, the poorly managed budget comes first.
Among the causes mentioned are:
- Multiple credits
- Chain credits (credits to repay other credits)
- A way of life above his income
Some records even show people who have hidden their previous loans in order to get a new loan, knowingly putting themselves in a perilous financial situation.
Common advice to avoid over-indebtedness
Financial institutions and insurance advisers (the Banque de France, Cofidis, etc.), all mention the same recommendations: saving and budgeting expenses. Indeed, it may seem obvious that we must spend less than we have, that what we earn, so we can survive in a sustainable way.
However, there are now many solutions that can exceed his budget, to easily subscribe to loans. These options are not necessarily to flee, but to use in a reasoned way. Even if your banking organization sends you a monthly report of your accounts, it must be kept in mind that it is the duty of everyone to check their accounts, taking into account the expected future withdrawals.
Indeed, it is tempting to be trapped by saying that “50 € per month for the TV”, it is not a sum which one must take into account, but the cumulation of these insignificant sums can tilt a savings healthy in the red.