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Depreciable credit: what is it? How it works ?

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Do you need cash to carry out a project, for example carrying out work? Bet on amortizing credit to raise the necessary funds. We explain everything about the depreciable personal loan and how it works.

Depreciable credit: definition

Depreciable credit is the most common type of loan in France. This is a loan that will be repaid in monthly installments a fixed amount which includes part of the starting capital and interest. Thus, at each maturity, the borrower repays the same amount, but at the beginning, the part of the interest is more important than that of the capital. This trend is reversed as the years go by.

Housing and eligible beneficiaries

The depreciable personal loan is often used to carry out work, buy a vehicle or even real estate financing. Many banks and credit institutions offer it. It can be easily contracted by individuals for their real estate purchases. To obtain a consumer credit, you must meet a few eligibility criteria, including residing in France, being of legal age and not being the subject of a bank registration at the Banque de France.

Depreciable personal loan: difference between fixed rate credit and variable rate credit

When it comes to borrowing, there are two main categories: fixed rate credit and variable rate credit. - Fixed rate loan: the rate is defined in advance and will not be modified, so you know from the start the amount of your payments. - Variable rate credit: the interest rate may decrease, but also increase throughout the repayment period. The amount of monthly payments may therefore vary. With a fixed rate amortizing loan, you can be sure that you know in advance how much you are due because the interest rate will not change. At Finance Studio, you can take out our depreciable personal loan directly online to buy a car, a motorcycle, a camper van, an electric car, etc. Or even finance your work via the work loan .

Depreciable credit is opposed to the loan in fine

The loan in fine does not work in the same way as the depreciable credit. Here, the borrower will only reimburse the interest for the duration of the loan. Monthly payment is therefore much lower than for a depreciable personal loan. However, he will have to repay the total amount of the capital at the end of the loan, in one go. It is usually a type of credit that is only used by people with high incomes and is less common than amortizing credit. Used by many people in France, the depreciable personal loan is the consumer credit par excellence. Very widespread, many banking and credit institutions offer it to individuals, like Finance Studio.