Up to date 17 October 2022

by Abdelkader Diarra – Trade manager

Loan interest registered on 17/10/2022.

Between the increase in interest rates, wear and tear rates that are barely rising, and galloping inflation, the current context does not seem very conducive to the realization of a real estate project. However, it must be remembered that banks are always open to financing. It’s all about offering the best possible file to avoid a mortgage loan rejection. Here are 4 tips to get your credit and finance your dream property!

1 – Check the feasibility of your project

Before you apply for a job offer or before applying for training with an organization, do you check the conditions required to qualify for the offer? Well for the mortgage it is the same. To increase your chances of being financed, check whether your profile and your project are in line with the banks’ requirements.

To achieve this, you can use the mortgage simulation tools available online to:

• Check your debt ratio. The first criterion observed by the bank is that the debt ratio must not exceed 35% (insurance included and new project included), according to the High Council for Financial Stability. If you are over the legal limit, you must repay your current credits as much as possible. In addition to the debt ratio, the banks also check your remaining life expectancy. In short, clean up your budget as much as possible to put the odds in your favor.
• Assess your borrowing capacity. With this type of tool, you can get an idea of ​​how much you can borrow based on your household income, the desired loan period and the specified interest rate. If you don’t yet have an idea of ​​what rate we can offer you, this type of calculator can by default offer you the average rate currently applied for the selected duration. Practical, right?

2 – Take care of your accounts

We can never repeat it enough, it is important to present a file with small onions. And that means cleaning up your bank accounts. In fact, the requested bank will attach great importance to the management of your income. End repetitive overdrafts, compulsive spending and gambling. Your bank statement is your CV. To verify the correct management of your resources, together with your loan application, you must provide the last 3 bank statements to study your financial behavior. So be exemplary!

3 – Present an adequate intake

This advice goes hand in hand with the previous one. A good manager is someone who manages to pay his bills and save every month, even a small amount. You are welcome to schedule an automatic transfer to a savings account to prove the seriousness of your approach.

4 – Play the competition

Property prices have increased since the beginning of 2022. In fact, the average interest rate was above e.g. 20 years at 1% in January versus 1.95% in October. To this significant increase came the problem of wear rate. As a reminder, the usury rate is the maximum rate at which banks can lend. This, calculated quarterly by the Banque de France, quickly fell out of step with the sustained rise in interest rates. But since 1eh In October, the interest rate rose to 3.05% for mortgage loans over 20 years and above, thus breathing new life into lending institutions.

” […] that the window of opportunity for borrowers with the increase in usurious rates will be relatively short. It is therefore more time than ever to get started and make your project a reality! “, explains Cécile Roquelaure head of studies at Empruntis.

To find the best deal, the secret (not so well kept) is to play the competition. But this task can be time-consuming. It is possible to call in a specialist whose main task is to refer you to the bank that offers you the best mortgage according to your profile and your project. A mortgage broker who is in regular contact with the financial institutions will be able to find the best loan for you.