Buying a property, works, Ferrari … a mortgage loan, a solution for all your projects?

With rising mortgage rates, more and more individuals can no longer borrow. If a mortgage loan can be a solution for some, this method is expensive.

We don’t tell you anything else, the mortgage market has been getting tougher in recent weeks. With an interest rate, the maximum rate at which a bank can lend, set at 2.57% until the beginning of October for loans of 20 years and more, the atmosphere is not festive.

In fact, the average loan rate over 20 years was 1.85% at the beginning of July according to broker Meilleurtaux. However, this nominal price should include additional expenses such as notary and file fees, but above all securing the loan. It can rise quickly Depending on the age of the borrower. As a result, many individuals are refused a mortgage because the total rate, also called the APR, exceeds the wear rate.

Do some work, go on vacation or buy a Ferrari

But then, should we give up credit if we’re in this situation? not necessarily! Little is known in France, unlike in countries such as Belgium or Switzerland, the mortgage loan Make a place in France.

How do you demand it? First of all, you must be the owner of a property located in France, and you have finished its payment. Then, instead of getting a classic loan with the borrower’s insurance, the bank can offer you not to go through a guarantee institution But to put the property you own as collateral, explains Cecile Rockellor, a spokeswoman for broker Empruntis. As soon as you go to the notary, to take out collateral, in real collateral, real estate to secure your credit, you are on a mortgage. If you pay off your loan as expected, you don’t have to worry. In the event of non-payment, on the other hand, the bank can resell your property to compensate itself.

you would understand that, It is impossible to finance your main residence this way if you are a first time buyerSince the basic principle of a mortgage loan is that the bank offers to secure the loan that it gives you through the real estate that you already own. Thus, a mortgage loan can be obtained for the purchase of a second home, with the aim of buying a property for rent or even acquiring a property abroad.

Real estate: buying or selling in life, what you really earn

This type of financing can also be used increasingly Financing an operation that has nothing to do with real estate. You can also apply for a mortgage to get cash, Ccile Roquelaure confirms. I can pledge real estate and ask for €50,000 in financing to pay for a dream trip, a motorhome or SCPI shares…if you are happy you can even buy a Ferrari! According to Empruntis, more and more people are using this process, for example, for Pay the inheritance fee or start a major business in their residence. The amount that can be funded in this way ranges from 22,000 to 750,000 euros.

Be careful though. A mortgage loan can’t be used for just any project, and for good reason: it’s expensive to prepare. We don’t offer a mortgage just to pay a vacation, Judge Sandrine Alonier, spokeswoman for broker Vousfinancer. There are very high fees, between Mortgage loan establishment costs, notary fees, experts fees, guarantee fees, management fees… We have for example the file of a borrower who wants to finance 127,400 euros. With fees, the loan totals €136,000, or €8,600 in fees. And in the context of buying a property, for a second home for example, you have to add to the notary fee (7 to 11% of the property value in the old house) another 1 to 2% for the mortgage.

professionals: Cheapest deals online for Reduce your bank fees

In addition, there are still a few banks that offer this type of credit, they are specialized banks or credit consolidation banks, notes Sandrine Allonier. Most of the time, the latter refuses to fund projects worth less than 50,000 euros, or even 100,000 euros for some. So the mortgage loan Often used for more complex projectsexplains Sandrine Allnier, who cites as an example financing files for the purchase of art or real estate in Europe.

For the rest, it works like a classic credit card. Real estate loans with a term of less than 20 years must comply with a fixed erosion rate of 2.60% (2.57% for loans of 20 years and above). If the mortgage loan is not affected by the property, it must comply with the erosion rates of consumer loans.

Then the bank determines an amount, a repayment period (from 60 to 300 months) and an amortization schedule. and ready, Mortgage loans are subject to varying rates Depending on the duration and profile of the borrower. Sandrine Alonier assures that no stripe is classic. For a mortgage, one of our partners is currently at 2.40%. For a non-mortgage loan, the ratio was 4.30%.

Mortgage Credit in Brief

Whose? Owners of income from property without outstanding credit. The credit must be repaid before the borrower turns 95.

What is the price? From 22 thousand euros to 750 thousand euros, according to Empruntis, from 50 thousand euros according to Vousfinancer, according to the mandatory debt ratio (35% after the project). The bank will often agree to lend you up to 70% of the value of your home.

Can I offer multiple mortgage properties for the same loan? It is possible to get a guarantee on several items. But in all cases, the latter shall be free from any credit or collateral in action.

How much time? Financing tenure varies from 60,300 months.

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