Rates are historically low, we all know that. But what we may not know is that future buyers are not the only ones to benefit. Indeed, for all those who have already taken out a loan in the past, this is also an opportunity to review their credit rates downward. So how do you take advantage of it and do it effectively? Here are our explanations.
State of the market
If we refer to the figures published by the Housing Credit Observatory / CSA, borrowing rates drop visibly, from month to month. Thus, for the last month studied to date, in November 2014, the loan in France was for an average duration of 207 months (or 17.25 years) for an average rate of 2.38%.
If we compare this same rate with that of October 2014, we note that at this period, the loan duration was slightly longer, on average one month longer, and that the rate was a few points higher since it was 2.50%. As you can see, the more the months pass, the more the rates shrink and this trend seems to be part of the long term!
To be able to review the rate of your mortgage, it is imperative that the difference is at least 0.60 point between the current rate and the one to which you have subscribed. This precaution is essential to offset the costs inherent in renegotiation. They correspond on average to 5% of the capital remaining due and include administration fees, guarantees, as well as early redemption indemnities. During the renegotiation, the banker will obviously take into account this 5% to put in perspective the new rate to which you can claim.
First, contact the banking establishment and the professional with whom you have taken out the mortgage. For this step, you will have to communicate your last three pay slips and your account statements to check the soundness of your finances (See our article: What do banks look at before granting you a loan?). The bank then has 10 days to make you a new offer. Then, you can accept or refuse it between the 11 th and the 30 th day.
Good to know
Nothing forces you to renegotiate your loan with the bank that granted it to you and you are free to compete. It may take longer, but you can expect some commercial efforts from other establishments to welcome you as a new customer. Finally, as for the initial subscription of a mortgage, you can have your rate renegotiated by a mortgage broker.
And you, have you thought about renegotiating your mortgage? Have you already experienced it and are you satisfied with it? Let us share your experience, the blog is there for that!