Mortgage loan: the maximum rate for a 20-year loan will exceed 3.5% on January 1

Europe 1 with AFP 12:29 p.m., December 29, 2022

The maximum legal mortgage rate, also known as the usury rate, will increase on January 1 from 3.05% to 3.57% for a loan of 20 years and more, according to the notice published on Wednesday in the Official Journal. .

Intended to protect individuals from abusive borrowing conditions, this rate caps all the costs of a home loan: credit rate charged by the bank, any brokers' commission, borrower insurance.

An increase "again well proportioned", according to the Banque de France"

The rate is calculated each quarter by the Banque de France, which takes into account the average rates charged by banks over the past three months, increased by one third.

There are as many wear rates as there are types of credits.

Thus, for a loan of less than 10 years, the maximum legal rate of a mortgage will increase in January to 3.41% (against 3.03% currently) and that for a loan between 10 and 20 years will increase to 3.53 % (against 3.03%).

This increase is considered "again well proportioned, and close" to the previous one, on October 1 by the Banque de France, the institution said in a press release.

"The year 2022 was again a favorable year for mortgages", according to the Banque de France, which noted a growth rate of mortgage loans to households of 5.7% in the first estimate.

“The interest rate conditions remained the most attractive and safest of the major countries in the euro zone,” she said.

Average interest rate of mortgages in France at 2.25%

The ceiling rates found themselves under fire from critics this summer, in particular from brokers who saw them as a barrier to access to mortgages.

One of their unions had even gone so far as to demonstrate on September 20 in front of the headquarters of the Banque de France in Paris, to ask the central bank to make a gesture.

During its last increase on October 1, the Banque de France had deemed "neither desirable nor necessary (...) an exceptional increase" in the ceiling rates, the role of which "is to protect borrowers".

Because raising the wear rate has the effect of making new mortgages more expensive for individuals.

The rise in interest rates for new mortgages has been noticeable since the spring, with the banks passing on the tightening of the monetary policy of the European Central Bank (ECB), via an increase in its key rate, in order to combat inflation.

The average interest rate on mortgages in France (all durations combined) stood at 2.25% in November, a highest for at least seven years, according to the dashboard of the Crédit Logement/CSA observatory. .

In November 2021, the average interest rate was 1.06%.