the usury rate exceeds 6%, good news for banks and borrowers

This maximum threshold at which a bank can grant you a mortgage loan reaches new heights in December. Banks will be able to accept more requests.

This is unheard of for more than 10 years, the banks are breaking the ceiling on the usury rate, this is rather good for buyers because it should give some breathing room to the real estate market. The more this usury rate increases, the more margins are left for the banks. This new ceiling should allow them to accept more real estate loan applications, under acceptable conditions.

This allows banks to accept files that are somewhat fair, without being slapped on the wrist by financial authorities, such as the High Financial Stability Council. Because the usury rate is the legal maximum, the threshold, the ceiling above which banks are not allowed to lend. And in the wear rate, we include all costs including insurance.

This usury rate was put in place to protect the borrower from too high a level of borrowing which would lead to over-indebtedness. It is the Banque de France which calculates it each month, it is published in the Official Journal. For loans of 20 years or more, it therefore reached 6.11% in December, unheard of since 2010! Above all, it has skyrocketed this year: in January, it was still at 3.5%.

Interest rates must also stabilize

Interest rates remain high, approaching 4.5%, but the good news is that these rates should stabilize in the coming months. The governor of the Bank of France also announced a few weeks ago that with the slowdown in inflation, the key rates of central banks, which give the “the” to interest rates, should no longer progress too much. All of this should allow buyers to have easier access to credits in the coming weeks.

Since the start of the school year, we have seen more and more banks return to the real estate loan market. While before the summer, the conditions were so strict that some had deserted this segment a little, it was not interesting enough for them. There, with a usury rate of 6% and interest rates stabilizing, they can lend again while generating profitability on the credits granted. With property prices falling – at least in the old ones – all this must give buyers options.