According to a study conducted by Diffusis France for Meelo, nearly a third of French people currently repaying a mortgage are experiencing financing difficulties. These difficulties are often linked to a loss of income, a drop in activity, or even closure for self-employed workers, craftsmen and shopkeepers.
Postpone or suspend due dates
One of the solutions available to French people facing financial difficulties is to defer repayments. This involves the borrower asking the bank to suspend monthly repayments for a certain period. Many banks offer this option under certain conditions. In most cases, deferment can be implemented after 24 months of repayment, for a period ranging from 1 to 12 months.
To obtain a deferment of payments, you need to submit a request to the bank, specifying the desired deferment period. Please note, however, that loan insurance cannot be deferred and must be repaid each month.
While deferring or suspending monthly payments is entirely free of charge, it does have the effect of extending the loan repayment period and generating additional interest. According to broker Vousfinancer, for a home loan of 200,000 euros taken out in 2018 at a rate of 1.5% over 20 years, suspending monthly payments of 965 euros excluding insurance for 3 months generates an additional cost of 885 euros.
Modulating due dates
If deferring repayments is not possible, borrowers can ask to modulate their repayments, a solution that can reduce monthly payments by 10 to 30%, subject to a maximum 2-year extension of the loan term.
Modulation of repayments is only possible if the contract provides for this option in the event of job loss, a drop in income or a life accident, and after a repayment period varying from 12 to 24 months depending on the bank.
This option is less expensive for the borrower than deferring instalments, since a large proportion of the monthly instalments are still paid. For example, a 6-month modulation of a loan taken out 2 years ago at a rate of 1.5% over 20 years generates an additional cost of 524.70 euros, according to Vousfinancer.
Combine all your loans into one
Households with several mortgages and/or consumer loans can opt for a credit repurchase. This technique involves combining several loans into a single, lower monthly payment. It is also possible to include the financing of an additional project (vehicle purchase, renovation, etc.) in the new loan.
Contrary to popular belief, the rates offered as part of a credit buyback are not that high. A homeowner with a very good profile can expect to obtain a rate of between 1.85% and 2% over 25 years.