Home loan interest rates vary from year to year and month to month. If you plan to buy real estate, bank credit is the practical solution to make your dream come true. Thus, you must follow the evolution of these credit rates to find the right deal.

RISING MORTGAGE RATES

Almost everywhere in France, we notice a rise in mortgage rates . However, some regions are experiencing rate stagnation , or even declines depending on the duration of the loan. To understand more about the 2022 mortgage rates, go to this site . Currently, the real estate market presents the following average rates :

in Île-de-France : there is no rate change for the 15-year loan which remains at 1.85% and for the 20-year loan at 2.00%. We notice an upward trend on the 7-year loan which rose by 0.10 points;

in the eastern region : rates are stagnating, except for the 7-year loan which reaches 1.70% ;

in the west : all rates are increasing . It is 0.05 point for the loan over 7 years and 0.10 point over 10 years to give 7.75%;

in the south : we see a drop of 0.05 points for the 10-year loan. Rates for 15 and 25 year loans are stagnating at 1.60 and 1.90% respectively.

THE RATE FORECAST UNTIL THE END OF THE YEAR

According to experts, the rise began around the start of the war in Ukraine. This has affected all financial markets . Because of the inflation we are currently experiencing, the increase in 2022 mortgage rates may very well continue until the end of 2022. If the average rate for the moment is around 1.90%, it will be around 2% for the coming months. Real estate professionals advise future buyers to decide as soon as possible to avoid this increase.

YOUR BORROWER PROFILE

Before granting you a mortgage , the lending bank carefully studies your file. The goal is to analyze the risk it runs by lending you the amount requested. To this end, the banker examines the state of your accounts , your banking history, as well as your financial habits . Your file must include supporting documents related to your employment.  Your employment contract and your latest payslips play essential roles. They reassure you of your ability to repay. According to these elements, the bank defines the rate and the acceptable duration for your loan request.

CENTRAL BANK MONETARY POLICY

You should note that the 2022 mortgage rate is primarily based on the monetary policy of the ECB or the European Central Bank . The latter sets a rate to be able to refinance . In practice, it makes funds available to banking establishments . It is a short-term loan that institutions must repay. Then, the lending banks use these funds to offer home loans to individuals. They set their own rate above that of the central bank to make a profit. As a result, the increase in the key rate leads to an increase with the banks.

YOUR BANK’S REQUIREMENTS

Your bank determines the interest rate based on the bank structure margin . It must find its share to avoid a loss after the reimbursement of the ECB funds. It is also based on business objectives and targets. For a young audience or first-time buyer, it defies competitors with fairly low rates . When it is aimed at owner and elderly targets, the rates are higher . In addition to these elements, it takes into account the geographical location of the property to be purchased. If it is located in an attractive city or department, the rates increase. For a house in the countryside, they can decrease.

THE IMPORTANCE OF SIMULATING A MORTGAGE

A home loan simulator is the essential tool before taking out a loan. It allows you to have an overview of the data on your future reimbursement. To obtain your result, all you have to do is mention the amount of the property you wish to acquire. You must also indicate the amount of your personal contribution for the purchase. Just like during an interview with a bank, the simulator requires the duration of the credit and some personal information. This includes, among other things, your occupation, age and postcode. The simulation makes it possible to determine the monthly payment and the repayment period . You can use a brokerto refine your request. It helps you get the best rate for your situation.