Real estate loan repurchase transactions are popular in France. The reason? The extremely favorable level of property rates which is driving demand. The latest data published by the Capital Lender reveals this phenomenon.
Month after month, the repurchase of home loan takes speed until representing more than half of the new loans to the habitat.
Significant increase in home loan buyback operations
In June 2016, 38.1% of new borrowings were renegotiations. In September, these operations represented 51.6%. November 2016 marks a new turning point with 58.8% of credit repurchase. Proof of the attractiveness of this operation for borrowers.
Exceptional market conditions ” push the production of new housing loans up ( 27.5 billion USD, after 24.8 billion USD), and in particular renegotiations (59%)”, details the Capital Lender in its latest statistics.
Home loan insurance contract: compare them
Admittedly, the real estate rates charged by the banks throughout the year boost demand. But the interest rate is not the only element to compare. Indeed, it is essential to take into account the mortgage loan insurance rates since having your mortgage repurchased means taking out a new loan AND a new loan insurance.
In fact, the bank rate can be very attractive, but the overall effective annual rate (APR) which includes the insurance rate can inflate the total cost of credit. Indeed, depending on the profiles the rate of home loan insurance can be high. It changes up or down depending on the amount borrowed, the age of the borrower and his profile (smoker, profession, etc.).
To get the best mortgage credit insurance rate, compare deals online. You can take advantage of a delegation of mortgage loan insurance. In addition, Hamon law allows you to change borrower insurance during the first year of subscription. Once this period has passed, you will no longer be able to cancel your loan insurance.
Indeed, the Sapin II law on transparency, the fight against corruption and the modernization of economic life provided for the introduction of the annual termination of insurance contracts. However, the article concerned was removed from the bill by the Constitutional Council.
What elements of the contract should you be vigilant about?
In addition to the insurance rate, it is essential to compare the different levels of coverage, that is, the guarantees covered by your home loan insurance contract. These vary from one insurer to another.
Another element to compare: the compensation conditions which can be lump sum or indemnity. Finally, read the conditions of care. Contracts very often include a waiting period and a deductible period. The waiting period corresponds to the period where you are not yet covered after the signing of the contract. Once this period is over, in the event of a claim, the excess period is the period when the insurer does not compensate you.
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