You have found your dream house or apartment and you are about to apply for a loan to finance it.
What are the different types of credit you can use? What is the most interesting depending on your situation? Response items.
Takes risk into account
In a fixed-rate loan, the interest rate does not vary throughout the loanwhich guarantees identical monthly payments and protects the borrower against increases in credit interest rates.
“Some borrowers may have an interest in choosing a different type of interest that better suits their age, their project and the risk they can afford to take in relation to their financial capacity,” says the Ministry of Economics. They will therefore be able to choose a variable interest rate if, for example, they expect interest rates to fall. » In this case, the interest rate may vary throughout the loan depending on the development of data taken as a reference, causing the monthly loan payments to fluctuate.
The total costs of the loan are therefore not known in advance. There is a variable rate “cap” which allows for a limitation of the rise and fall of the interest rate to limit the risk.
Most loans today are granted at a fixed interest rate. However, in times of high credit interest rates, variable rate loans can allow certain households to complete their property purchase.
Caution remains important with this type of loan.
A choice in relation to your project and your borrowing capacity
The difference is how you repay interest and principal. “With a repayable loan, interest, borrower’s insurance and capital are repaid with each monthly payment”, explains Côme Robet, president of CNCEF Crédit, an approved professional association of credit brokers and agents.
Whereas with a standing loan, the capital is not included in the monthly payments, but is paid in one go at the end of the loan.
Amortizing loans, which are commonly used, are for you if you want to acquire a primary residence. “The ultimate loan is aimed at those who can provide capital as security for the bank, for example life insurance for the loan amount”, remark Come Robet. “It is often used for a rental investment to continue to grow your savings. »
The zero-interest loan (PTZ): 50% financed without interest for repayment
PTZ allows you to borrow, without interest for repayment and for a maximum of 25 years, up to 50% of the total cost of buying a new apartment in a cramped area or a completed apartment or house for more than five years relaxed area, but which requires work.
It is subject to resource conditions depending on the area where the dwelling is located and the number of people intended to inhabit it.
It is made for you if you are buying your first primary home. And if you are afraid to do major renovation works, because for an old property they must make up 25% of the total costs of the operation.
“By combining it with an eco-PTZ (without funds conditions), you reduce the average speed of your operation to a very attractive level”, states Côme Robet.
Loans with interest subsidies: to complete your financing
This type of loan, guaranteed by the state, makes it possible to complete the financing of the purchase of a primary residence by borrowing at a reduced interest rate (lower than the current market interest rates).
“Until now, intended for certain categories of borrowers (officials, first-time buyers, agricultural or private sector employees, etc.) and particularly subject to resource conditions and geographical area, the government plans to provide loans at subsidized rates. Many banks, who want to attract new customers, offer them, ask them,” advises Côme Robet.
Bridge credit: subject to conditions
This loan gives you the opportunity not to wait for the sale of a home to acquire a new one. For 12 months, which can be extended once (a total of 24 months), you can obtain a sum of between 50% and 70% of the price of the property you put up for sale.
“We distinguish between dry bridging credit, acquiring a home whose price is lower than the price of the property you are selling, and bridging credit with a new property loan because the home you are buying is more expensive than the one you are buying. sell and need additional financing”, explains Côme Robet from CNCEF Crédit.
In both cases, you only repay interest and borrower’s insurance during the term of the loan, where the capital is repaid when you sell your first property.
“It is made for you if your first home is in an attractive area or one in high demand (close to shops, schools, transport), which will enable it to sell quickly if the assessment of its price does not is overestimated, at the risk of not finding a buyer in time and if the capital to be repaid on the first loan is significant.
