Depreciable credit for professionals
The Professional Depreciable Credit is a type of professional loan that has many variables and allows the company to adjust them according to their needs.
What is the professional depreciable credit?
The professional depreciable credit consists of progressively repaying, throughout the loan, the interest on the loan and the capital. The professional depreciable credit may be at constant maturity, ie each term is identical throughout the credit and includes, as the loan progresses, a declining share of interest and a capital repayment portion that increases. . The professional depreciable credit may also have a declining maturity. This corresponds to the fact that the maturity includes a constant repayment of capital, the interest being calculated on the share of capital remaining due, so the installments are degressive. The repayments can be monthly, quarterly, semi-annual or annual.
Who is the professional depreciable credit for and under what conditions?
The professional depreciable credit is intended for all types of companies and makes it possible to finance various types of professional projects.
The duration of the credit varies according to the nature of the project to be financed, it oscillates between 2 years for professional material and 15 years for real estate. The repayment period often depends on the duration of the tax depreciation of the financed project.
The implementation of a grace period for a short period is sometimes possible for the company, allowing to pay only the interest of borrowing. The return of capital is then deferred.
Agreement of a professional depreciable credit
To make a decision on the agreement of a professional depreciable credit, the bank will rely on the nature of the transaction, its amount, its duration and thus determine the strength of the company against a professional depreciable credit. It requires in most cases a disability-death insurance to cover but also not to jeopardize the company in case of problems. A personal contribution is also recommended for this type of credit.
The rates can be fixed that is to say invariable and unique throughout the loan or variables, they are then associated with a fixed rate but are revised on each anniversary date. The fixed rate will be preferred in the event of a rate increase period and if the duration of the loan is significant. On the other hand, a variable rate will be preferred when rates tend to fall.