What will the new borrowing rules change for you?

Of the “technical adjustments”, but who do not return to the “fundamentals” rules for granting real estate loans. On the occasion of a meeting of the High Financial Stability Council (HCSF), theThe Ministry of the Economy and the Bank of France announced, Monday, December 4, several measures to relax the use of borrowing, and revive a slowing real estate market.

Even if these announcements do not fundamentally disrupt the conditions of access to credit, they will “put a little oil back into the wheels” and bring “small improvements for certain profiles” borrowers, observes Cécile Roquelaure, research director at Empruntis. Franceinfo takes stock of these measures.

Loans up to 27 years for major work

To combat over-indebtedness, the High Financial Stability Council has prohibited banks since 2022 from granting a mortgage loan if housing-related expenses (loan repayments, rent, energy bills, etc.) exceed 35% of income. borrowers. This is called the effort rate. The HCSF also limits the maximum duration of credits to 25 years, with a few exceptions. “SIf you buy new, you already have the right to add two years of deferral, the time to have it built”recalls Cécile Roquelaure.

This maximum loan term was already extended to 27 years in the event of renovation work representing 25% of the total cost of the project. The new decision of the HCSF (PDF document)published Monday, lowers this threshold and will allow you to benefit from a credit over 27 years as soon as the work represents “10% of the total cost of the operation”. This measure will apply to “all types of work”assures the Ministry of the Economy to franceinfo, whether it concerns energy renovation, development or modernization work.

Extending the credit duration makes it possible to reduce the burden of monthly payments for borrowers. At an unchanged interest rate, this extension from 25 to 27 years will reduce the monthly payments of a household borrowing 100,000 euros by 22 euros, and by 45 euros for a loan of 200,000 euros, calculates the director of studies of Borrowed. “By reducing monthly payments, mechanically, the HCSF lowers the effort rate and will therefore allow a few additional households to be entitled to credit”explains Cécile Roquelaure.

The impact of this measure, however, risks being “extremely limited”, according to the expert. This measure “will play on the sidelines” for households which barely exceeded the 35% effort rate threshold. Caroline Arnould, general director of the Cafpi broker network, also argues with West France that “the files with work are not very numerous”and “loans with work represent 2% at Cafpi”. “And above all, you will add the cost of credit, because extending a loan means paying more interest,” deplores Cécile Roquelaure.

Interest on bridging loans excluded from the effort rate

The second announcement is aimed at households who have taken out a bridging loan and who also wish to obtain a traditional property loan. The HCSF has decided to authorize banks to exclude interest paid as part of a bridging loan from the calculation of the borrower’s effort rate. Provided, however, that the amount of the bridging loan does not exceed 80% of the value of the property sold.

“The bridging loan is intended for households who make a purchase transaction and who resell their home at the same time. These profiles represent a small part of the borrowers.”

Cécile Roquelaure, director of studies at Empruntis

at franceinfo

Second-time buyers only represent approximately “20% of buyers of a primary residence”underlines the specialist. Furthermore, the Banque de France estimates that bridge loans only represent 7 to 8% of the production of real estate loans. “This is not a revolution. Today, banks already have access to mechanisms, such as the acquisition bridging loan or the partial or total deferral, which make it possible not to include the bridging loan in the calculation of the rate effort”analyzes broker Caroline Arnould with West France.

Maël Barnier, spokesperson for the brokerage site MeilleurTaux, regrets on franceinfo that the HCSF is not returning to the rule of 35% effort rate. “On the ground, we see that it blocks almost one in two files, including among French people who have comfortable incomes”affirms the specialist, who deplores files refused to “36, 37 or 38% debt”.

More flexibility for banks

Banks also have room to maneuver to grant credit beyond the regulatory duration or to a household whose effort rate exceeds 35%. In total, 20% of files validated by a credit institution each quarter can circumvent these rulesprovided that this primarily concerns loans for the purchase of a main residence.

In reality, these exceptional quotas are underused by banks. The HCSF notes that “the use of banks’ flexibility margin remains significantly below the 20% ceiling, at 14.3% in the third quarter of 2023”. To remedy this, the authority has decided to smooth this margin of exemptions over three rolling quarters. It thus hopes to give a little more flexibility to banks so that they do not refuse credit to borrowers during the quarter, for fear of having already exhausted their exceptional quotas.

Cécile Roquelaure fears that this new method of calculation “do not change anything”. “It is difficult for banks at the head of a network of branches to manage the waiver rate branch by branch. With this new complexity, many will prefer to be cautious”adds Caroline Arnould to West France.

A right of reconsideration in the event of loan refusal

Finally, the HCSF came out in favor of a review system in the event of refusal of a real estate loan. “A mechanism for re-examining files will be put in place by the banks so that a second look can be taken at solvent files which have been rejected,” details Agnès Bénassy-Quéré, second deputy governor of the Banque de France, in a note.

The Minister of the Economy explains that he wants to establish “an amicable procedure, between the borrower and the banker”. “This procedure should help to understand why the loan was refused and possibly, if the borrower’s situation allows it, lead to a review of the decision”says Bruno Le Maire Parisian. The system should come into force in February, adds the ministry to franceinfo.

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