Between individuals, a real loan
It is true that this solution, which is developing more and more in the family environment, is much less formal than a credit granted by a banker, who will require a certain number of supporting documents - income, expenses - before whether or not to lend money. In many cases this is a "depreciable" loan (each month a monthly installment of principal and interest), the rate of which varies widely: between 4% and 18% for consumer credit and the duration a priori fixed. And if the debtor can not settle or a multiple monthly payments, the penalties fall. In addition, you should know that in a financial institution, the funds will be issued after a period of between 7 and 14 days.
Credit between individuals: flexibility and ease
Compared to a bank loan, the family or friendly loan solution offers the advantage of flexibility and ease: the rules of the game are freely determined between the parties. It can be decided that the capital will be repaid at the fixed term, at a very low interest rate, or even zero. However, it is strongly advised to observe a certain formalism if one lends money to one of his friends or one of his children, so that this help does not turn into a big misunderstanding that ends in the office of the judge or ... by a tax adjustment. The loan of money between individuals therefore requires formalizing this act by a contract established between the interested parties and including terms of reimbursement clearly understandable. If lending money without a bank does not require a cooling-off period, it is still recommended to take several days before signing a contract or a debt recognition, this allows to take into account the financial commitment of the l borrower but also the lender.