Mortgage loan: the rate and maximum debt duration extended

The High Council for Financial Stability, which brings together the Ministry of the Economy and the Banque de France, among others, decided on Thursday to relax the rules limiting the granting of real estate loans, but by making their monitoring compulsory for banks, has announced the Minister of the Economy Bruno Le Maire.

The maximum debt period will be increased from 25 to 27 years, the maximum debt ratio will be raised to 35% against 33% previously, and the volume of exceptions to these rules will increase from 15% to 20% of all credits granted, detailed the minister to journalists.

"Some banks did not follow the rules enough"

These limits were set a year ago, with the aim of limiting household over-indebtedness.

This marked a turning point for the financial authorities, who until then had shown their serenity in the face of a booming French housing market.

The relaxation aims in particular to help first-time buyers.

According to the minister, the rules have proved their effectiveness, the share of loans resulting in a debt ratio above 33% having decreased by 7 percentage points, and that of loans with a maturity of over 25 years of 4 points.

Noting, however, that "some banks have not sufficiently respected the rules", which were until now recommendations, Bruno Le Maire announced that he would "in the coming weeks", with the Banque de France and the supervisor of ACPR finance, define "the legal procedures to make these provisions binding".

The share of credits outside the nails was not revealed.

On Wednesday evening, the governor of the Banque de France François Villeroy de Galhau had already opened the door to an easing, in an interview with

.

"I am ready to propose a limited, reasonable adjustment of certain criteria, but on the condition that we clearly and firmly stay the course: that of stopping a continuous drift in the granting conditions, which would expose households to the risk of over-indebtedness, "he said.