Loan from Bank Populaire?

[Mary S]

I have bought a house recently in Vernet les Bains and am now about to rewire, replumb, and do a few other refurbishments. I had considered paying for this work from my savings in uk. However, when I opened an account with the BP in Vernet, the manager asked me if I might need a loan, they are charging 5% interest.I said no at the time but given that my hard earned savings in uk are suffering at present with the bear market, after some thought, it seemed perhaps an idea to borrow from BP. Has anyone taken out a loan with them and what does it involve. I don't have any problem with credit checks being made, etc. I just wondered how long it might take to get a loan and does it make sense?

[gburrows]

>I have bought a house recently
>in Vernet les Bains and
>am now about to rewire,
>replumb, and do a
>few other refurbishments. I
>had considered paying for this
>work from my savings in
>uk. However, when I
>opened an account with the
>BP in Vernet, the manager
>asked me if I might
>need a loan, they are
>charging 5% interest.I said no
>at the time but given
>that my hard earned savings
>in uk are suffering at
>present with the bear market,
>after some thought, it seemed
>perhaps an idea to borrow
>from BP. Has anyone
>taken out a loan with
>them and what does it
>involve. I don't have
>any problem with credit checks
>being made, etc. I
>just wondered how long it
>might take to get a
>loan and does it make
>sense?

I have not taken out a loan in France and so cannot give the benefit of my experience. However, if you wish to be prudent then your best move would be to take out a loan in the country of your income. If your income is from the UK then remember that that sterling is not fixed to the euro and that potential instability may cost much more than the interest savings (you do not say whether 5% is flat rate or APR) and if the exchange rate becomes very unfavourable you may have difficulty servicing the loan. If your income comes from France, then you have to decided whether the interest rate is competitive.

[Richardbk]

If it is the TEG (or APR) rate it is reasonable, but if it is their first offer, you should be able to push them lower, so I'd still look around, get a quote elsewhere and then come back to them. If it is the flat rate then it is way too high. E.g even Carrefour are offering 5.95% TEG.

French credit restrictions mean that your monthly payments on credit must not be greater than 1/3 of your net monthly income.

Apart from that there are no other real issues. Clauses to look for include lump sum payments and paying off the loan early early. Usually these can be negotiated in a mortgage, but seldom in a personal loan of a few years. You also need to decide if you need insurance on the payments and if so what type of insurance you want.

regs

Richard