LThe French know little about the laws of their country. It’s a shame, especially when they serve to protect people in financial distress who can no longer make ends meet, the over-indebted, more and more numerous today, faced with the increase in the cost of life.
After two years of high inflation, at 5.2% in 2022 then at 4.9% in 2023, unheard of for more than thirty years, the Banque de France recorded a rise of 17% of overindebtedness file submissions in the first quarter of 2024. And this is only the visible part, because many people in financial difficulty do not dare to open the door, out of fear, shame or ignorance of the procedure .
The probability that we will give up, that they will be able to start from scratch, is in reality all the greater as their situation has no hope of improvement. But how many over-indebted people know that, if they take steps in this way, they would have a good chance of seeing all of their debt erased?
One in five French people live uncovered every month
Wanted by Jean-Louis Borloo, then Minister Delegate for the City and Urban Renewal [de 2002 à 2004] and inspired by local law in Alsace-Moselle, the law establishing this so-called “personal recovery” procedure is celebrating its twenty years of application this year. Over two decades, this right to a second chance has gradually established itself as the solution favored by over-indebtedness commissions to relieve households no longer able to meet their debts.
On average, a little more than 20,000 euros of debt is erased per file, for a total cost of 1.3 billion borne by the community of creditors. Among these, in addition to consumer credit companies or banks, more and more other institutions and businesses are also affected, because many households today simply cannot cope with the everyday living expenses (rent, energy, health, transport, etc.), with a sharp increase in what we call passive over-indebtedness.
The occurrence of a life accident, dismissal, illness or separation, is usually an element which aggravates situations. However, they are less and less of an explanatory factor. One in five French people live uncovered every month.
Applications admissible in nearly 95% of cases
In 2023, according to Meilleurtaux, 56% of borrowers used consumer credit to meet their monthly budget, which is 8 points more than in 2022. Energy and food then form a double sword of Damocles for these households more obsessed with their ends of the month than with ” end of the world “. Women (55%) are more concerned than men (45%). Rather than following the advice of influencers ” budget “who make their fortune on the Internet, these people in financial distress would have every interest in submitting their file to the Banque de France.
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