Monthly Archives: June 2019

The consumer credit market remains buoyant, according to several brokers. In December 2017, in France, the volume of loans granted increased by 5.9% year-on-year. The French are increasingly using consumer credit. This is due to lower rates and attractive offers regularly offered by the institutions.

Offers at 1% over one year

For very short durations (over 12 months), 1% rates became frequent. Finally, borrow 10,000 euros over 12 months at a rate of 1% is to pay 54 euros interest only, for monthly repayment of 838 euros. Over two years, the monthly payments are less heavy, to 427 euros. However, in this case, it is no longer possible to benefit from the 1% call rates. The average market rate is 2.5% for a total cost of credit of 259 euros.

With such conditions, it may be interesting to take out this type of consumer credit to deal with unforeseen expenses or a need for one-off cash rather than tap into savings. In addition, when the desired amount is around 10,000 euros, borrowers can often take out an unallocated loan to use the amount granted as they see fit.

The consumer credit market is doing well

Several experts point to the dynamism of the consumer credit market. In 2017, some brokers received more than 300,000 consumer credit applications. This increase is mainly driven by amortising loans (+6.2%) and leases (+33.1%) while the outstanding amount of revolving loans decreases.

The average age of the borrower is almost 40 years old. However, the borrower of a credit work is older, at 44 years on average, while the borrower of a car loan is a little younger (38 years).

Thus, in 2018, the consumer credit market still benefits from a low interest rate policy by lenders. This situation is ideal for the middle classes who do not wish to start saving. Even if the rates remain attractive, it is advisable to remain vigilant and wait to have a specific project before going into debt over a few years. The borrowers who have a concrete project have, them, all interest to make play the competition.

Dumel, the national agency for information on housing, is fully in its role when it comes to scrutinize the evolution of real estate rates. This association, which brings together major players in the housing (government, industry, users), noted a stable relationship at the 3rd quarter with a level of detail that needs to stop.

OAT down, good news

Every three months, Dumel’s Mortgage Rate Indicator unveils a series of figures that provide a precise and comprehensive overview of the market situation. The first data is often forgotten by the other barometers of the kind: the OAT 10 years. Treasury equivalent bonds. These are the securities that finance the states in the long run, and their rates are also rain and shine in terms of auto credit. And the good news is that contrary to predictions, this indicator is down between the 2nd and 3rd quarter 2018: 0.71% (-0.13 point). A factor of increase in less!

A wide variety of rates

Where the barometers of mortgage rates usually offer an average, the Dumel delivers a low range and a high range. This for an immo loan on 15, 20 and 25 years, the three main durations of borrowing in real estate. In Q3 2018, the rate of a mortgage over 15 years ranges between 1.20 and 1.40% in the low range, and 1.60 to 2.25% in range. A significant difference that shows that not all profiles are treated in the same way by the lending institutions according to their project and especially their file, related to their borrower profile. For an amount of € 100,000 over 15 years, monthly payments go from € 637 (for 1.20% excluding insurance) to € 685 (for 2.25% excluding insurance). Over 20 years, mortgage rates stretch from 1.30 to 2.35% over 25 years from 1.58 to 2.45%.

The figures of PAS

The other particularity of Dumel’s mortgage loan rate indicator is to provide the figures for the Social Accession Loan (PAS), an immo loan offering reduced rates for low-income households.. Over 15 years, there is no difference with conventional low-end mortgage rates : it is only at the high end that the data remains more accessible (1.40 to 1.85%). Over 20 years, the figures are concentrated between 1.30 and 2%, while they are between 1.50 and 2.20% over 25 years.