In December 2023, the High Council for Financial Stability (HCSF) declared its support for the initiative of French banks in favor of a procedure for reviewing refused real estate loan files. The latter should see the light of day during February. It remains to be seen how many borrowers will be able to benefit from it.
Was your real estate loan application refused? You now have the right to try your luck again. Last December, the HCSF ensured support the initiative of French banks in favor of a second level examination procedure for real estate loans. While a market agreement was signed with the French Banking Federation (FBF) at the end of last year, its implementation would only be a matter of days. The re-examination of the files will be made possible during February, specifies the Bank of France.
Only a minority of borrowers affected?
Who will really be affected by this measure? In December, the HCSF estimated that only a minority of cases could ultimately obtain the desired credit after review. The goal is not to avoid all refusals. Not everyone can take out a loan of any amount, so it is normal that there are refusals. Thus, the system should only be open to solvent households, whose effort rate does not exceed 35%.
This transitional and temporary measure will take place during this phase of adjustment of the credit market, marked by a context of rising rates and strong disparities between regions. The objective is to facilitate relations between borrowers and lenders, detailed the HSCF in December.
It remains to be seen whether the measure does not come too late. If the number of loan refusals exploded in 2023, in particular because of rates rising from 2.5% in January 2023 to 4.5% in December of the same year, the situation seems to be improving in recent weeks. Some borrowers can now borrow below 4%, and some credit professionals are even considering rates of 3% by the end of the year. Enough to restore solvency to borrowers and unwind the market.