Inflation during the year 2022 raised fears of the worst. Finally, it will not have swelled the ranks of over-indebted people. In 2022, 113,000 over-indebtedness files were filed with the Banque de France, a decrease of 7% compared to 2021. This is also less than in 2019. Since the peak in 2014, the number of over-indebtedness files was halved. As a reminder, a person is said to be over-indebted when they can no longer meet their debts. The notion of good faith is taken into account to assess the situation. It remains to be seen who are the over-indebted households?
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Data from the Banque de France, published on Monday, February 6, provide some answers. Unsurprisingly, women and “isolated” people are still overrepresented in over-indebtedness cases. “People in over-indebtedness are often single adults or women, especially when they are heads of single-parent families,” the Banque de France said in its press release. Women thus represent 55% of debtors and co-debtors, compared to 50% in the French population as a whole. In particular, single women with children represent almost 20% of cases but less than 10% of all households.
Men are not spared, however, since 28% of over-indebted households are men living alone (16% in the French population). Note that one over-indebted household in five is a single-parent family, twice as many as in the general population. Banque de France data also informs us of the social situation of the persons concerned. Furthermore, 61% have a standard of living below the poverty line, compared to 15% for the French population as a whole. Nationally, the median monthly standard of living is 1,881 euros; that of over-indebted households is 1,084 euros. What about their profession? A quarter of its people are unemployed. Employees, workers and people without professional activity are overrepresented in relation to their share in the French population.
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People in debt who are often younger
And 88% are tenants or hosted free of charge, “more than double than in the French population”, according to the Banque de France. “In over-indebted households, family benefits, housing allowances – including activity bonus – and social minima account for a quarter of income (6% of income for French households)”, underlines the file of the Banque de France. To complete the composite portrait of a person in debt, it remains to know how old are they on average? Contrary to popular belief, seniors are not the most affected. Two-thirds of indebted individuals are between 25 and 64 years old. Only 13% are 65 and older.
Regarding their level of indebtedness, there is nothing derisory: the median amount reaches 18,024 euros. Debts that come from their difficulties in honoring their mortgages, repaying their consumer loans or paying their current expenses (rents, tax debts, energy or telephony debts, etc.) There are disparities between regions. Among the most affected, Hauts-de-France (Eure, Pas-de-Calais, Somme, Aisne), Upper Normandy (Eure, Seine-Maritime), the Center (Creuse, Indre, Cher, Allier, Nièvre, Saône-et-Loire) or certain parts of the Grand-Est. In total, fourteen French departments list more than 280 filings of over-indebtedness files per 100,000 inhabitants aged 15 and over.
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“On the profiles of people, there is no notable development in 2022”, explained in a press conference Hélène Arveiller, deputy director of the private individuals of the institution. In 2022, the share of real estate loans in the indebtedness of over-indebted households has however decreased compared to the previous year, in favor of current expenses such as bills and rents. The share of consumer credit is stable, 38% of total debt. In total, there are 4.3 billion in overall debt. It should be noted that 27% of the overall debt is erased, ie 1.3 billion euros. “The rest of the debt is rescheduled and interest is reduced,” continues the Banque de France. Four files out of five are affected by arrears of current charges.
In each department, a commission is responsible for examining the files submitted by people who wish to access the procedure for dealing with over-indebtedness. The commission verifies that these people meet the criteria to benefit from the procedure, then looks for the most suitable solutions. The Banque de France has provided secretarial services for the committees since the start of the procedure in 1990. “Half of over-indebted households have no repayment capacity to meet their debts. Life accidents such as loss of “Employment or separation often aggravate already fragile budgetary situations”, estimates the Banque de France.