Borrowers are not the only ones to benefit from the increase in the usury rate, that is to say the maximum legal rate at which banks are authorized to lend. For the latter, this also means the possibility of boosting their production of credit.
The Banque de France’s decision to review the usury rate every month, ie the all-inclusive maximum rate above which a bank cannot lend, will breathe life into borrowers and the real estate market. However, this should be accompanied by an increase in bank interest rates.
So far, faced with the impossibility of raising their real estate rates sufficiently, while the rate for 10-year OATs (Assimilated Treasury bonds called OATs are French State debt securities and serve as a reference for banks to set the interest rates they grant Ed.) continued to increase, many banking institutions had indeed decided to withdraw from mortgage loans. The latter should therefore return to it, while rebuilding their margins.
Increases of 20 cents in some banks
The movement has already begun, as noted on Twitter Sandrine Allonier, press officer for the broker Vousfinancer.
The increase was expected. A few weeks ago, Mal Bernier, communication director of the broker Meilleurtaux, thus expected bank interest rates to continue to rise, before stabilizing at around 3% or 3.20%. In its February rate forecast, the broker Cafpi predicts that increases will continue to follow at a rate of around 20 cents per month before rates stabilize around 3.50% by June.
Unsurprisingly therefore, the February bar charts are maintaining this upward momentum, with average increases ranging from +0.11 0.25 points according to the tough ones and the interrogated brokers. Over 20 years, the most common term for a home loan, the average is around 2.70%, when a loan over 25 years is increasingly approaching the 3% mark.
Average rates in banks at the beginning of February
- On 15 years old: 2.53% according to Meilleurtaux; 2.65% for Loans; 2.40% according to Vousfinancer.
- On 20 years: 2.64% according to Meilleurtaux; 2.75% for Loans; 2.70% according to Vousfinancer.
- On 25 years: 2.97% according to Meilleurtaux; 2.85% for Loans; 3% according to Vousfinancer.
Average rates noted by the brokerage networks, based on the scales provided by the banks. They do not take into account the cost of borrower insurance.
Nevertheless, this rise in rates is not necessarily bad news for some borrowers: With wear rates of 3.79% over 20 years and more, we will be able to finance files at rates of up to 3.3% over 20 yearsanalyzes Julie Bachet, Managing Director of Vousfinancer.
Real estate credit: find out the lowest rates for your project
According to Vousfinancer, an individual with average incomes borrowing 200,000 euros over 20 years at 3.30%, with an insurance rate of 0.35% on the remaining capital, a Crdit Logement guarantee of 2,660 euros, as well as 1,000 euros in administrative fees, will have currently an APR 3.76% and the possibility of being financed, which was not the case in January. Indeed, since February 1, the usury rate has been set at 3.79% for home loans with a duration of 20 years and more.
Find the best rate for your real estate project