As expected, a new banking reasoning process is emerging. For many years now, productivity and development were the main drivers of a market share strategy.
Today, we see a desire to bring the notion of risk protection back to the fore. This positioning, linked to the lack of awareness of the impact of the Covid crisis, has the effect of creating a revolution in the approach to loan applications: risk becomes the central point of the reasoning before the assessment of the GNP potential of customer long-term relationships.
The combination of this phenomenon with the latest directives from the HCSF (French High Council for Financial Stability) as well as the debt recommendations of the Banque de France regarding households have led banks to drastically modify their policies.
As a result, all potential buyers can be concerned by loan refusals ! For first-time purchasers, the lack of contribution is penalizing with requested levels difficult to achieve sometimes. A for investors, they are often opposed to their debt ratio exceeding 33% in view of new “real” calculation techniques (full integration of the loan charge and inclusion of the rent at 70%) in contrast with the “differential” method (rental income up to 70% less charge = deferral amount) previously in force.
We hope that the scope and impact of these measures on economic activities will make the government authorities react to encourage banks to support buyers. Otherwise, the real estate market will still be active, but the weakest link in the property chain will be access to mortgages which is critical throughout the process. According to many observers, professionals should now expect to face project failures as the refusal rate increases very significantly.
Therefore, it is crucial to require the services of a loan mortgage expert specialized in cross-border brokerage to optimize your chances of success. For more information, please call upon us with our contact form