The High Financial Stability Council or HCSF made the decision to to release the terms of concession of the real estate loan, on December 17. This is the authority in charge of monitoring and some preservation of the stability of financial system In France.
According to Bruno Le Maire, the current Minister of the Economy, Finance and Recovery, but also the president of the HCSF, when the French are first-time buyers, it remains important that they have a easy access at credit, and this, in optimal conditions.
The share of monthly payments linked to household income, also called effort rate or debt rate, previously amounting to 33%, now reaches 35%. Until now, a household was not able to dedicate more than 33% of its net income to its credit, even after deducting fixed charges. This threshold currently rises to 35%, thus offering a palpable relaxation.
According to the calculation of the broker Vousfinancer, a couple with an income of 3,000 euros, with a increased monthly payment of only 60 euros, can ask over 25 years, a ready 15,000 euros more at 1.5%, or 262,542 euros compared to 247,539 euros previously. It takes on debt at 35% rather than 33%. Bank branches impose more and more one personal contribution in order to maintain the 33% rule and a duration capped at 25 years. According to the Crédit Logement CSA Observatory, the share of banks for finance the individuals amounted to 11% per year in November 2020, compared to a drop of 5.2% in 2019. Thanks to this relaxation, the need of personal contribution go decrease.
The ceilings of the durations of credit remain at 25 years. However, the deferred of refund in relation to the duration of works for the acquisitions on plan in new buildings will now be taken into account. A loan for this type of project can then last up to 27 years, that is to say 25 years with a two-year grace period. For the promoters having suffered a turnaround situation this year with the drop of their sale at more than 30%, it is a real positive. With a possible decline of 13 to 14%, property builders reduce breakage. The bank branches risk to infringe the rules of HCSF on files which currently amount to 20% compared to 15% previously.
The buyouts and renegotiations of credits are also taken into account in this relaxation, as long as the operations lead to the reduction of debt ratio or the duration of retribution. However, this limited duration will not acquiesce in the integration of Zero interest loan (PTZ) like the duration depreciation of 30 years maximum for first-time buyers who resorted to this PTZ.
The other change paradoxical concerns the new softening rules harder. Even if the president of the HCSF seems happy with the positive effects of restrictions issued by the public body in December 2019, he does not appreciate the reaction of the banks on this subject. As a result, he affirmed that by the summer of 2021, the new recommendations of HCSF of December 2020 will be more restrictive. The minister's services will above all be based on the practical aspects and legal of these new rules to come.
For François Villeroy de Galhau, the governor of the Bank of France, it is in no way feasible to soften the rules at the moment of bank branches. According to him, a limited fit and reasonable of most of criteria has been decided, but on condition that we firmly and clearly stay the course. So he thinks restrict the risk of overindebtedness of the households by stopping the perpetual derivative of the conditions of grant.
