The rate cut is underway, should you think about renegotiating your mortgage?

The rate cut is underway, should you think about renegotiating your mortgage?
The rate cut is underway, should you think about renegotiating your mortgage?
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homas Feuvray cultivates reasonable optimism. The broker, who founded Obontaux, a real estate loan brokerage company, 13 years ago in Angoulême before expanding into the region as far as Angers and Rennes, monitors economic trends on a daily basis. Will the decline in rates continue in the coming months? “Over the year, the trend will be downward for a simple reason, that is…

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homas Feuvray cultivates reasonable optimism. The broker, who founded Obontaux, a real estate loan brokerage company, 13 years ago in Angoulême before expanding into the region as far as Angers and Rennes, monitors economic trends on a daily basis. Will the decline in rates continue in the coming months? “Over the year, the trend will be downward for a simple reason: the economy will slow down.”

After a sluggish year in 2023 for real estate and credit rates blithely passing the 4% mark, 2024 began with a drop in rates of an average of 10 basis points per month, notes in a study L’ Housing Credit Observatory. With a cap of 4.21% being reached in November and December 2023, rates then rose from 4.13% in January to 3.99% in February and up to 3.90% in March.

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Some are even talking about a landing at 3.25% at the end of the year. Credible? “It’s not crazy at all,” says Thomas Feuvray. Samuel-John Gaultier, commercial director of Crédit Mutuel Sud-Ouest, assumes not to play oracles in terms of foresight to the extent that “there is caution from the European Central Bank regarding the amplitude of the decline and even more on the period concerned”. Adding that “maintaining rates makes it possible to curb the rise in prices”.

Fees generated

Should recent owners, who acquired a property at the peak of rates in 2023, already be thinking about renegotiating their credit? “There should theoretically be a point difference between the old and new rates,” begins Thomas Feuvray. We are not talking about the APR, which includes all the costs of your credit, but the nominal rate, the one which reflects the cost of money. Why do we have to wait for this point of difference? “Because the renegotiation will generate costs, for example penalties, early repayment costs that the banker will ask for who will have his loan repaid earlier. » Penalties which amount to “six months of interest, within the limit of 3% of the remaining capital”. Without forgetting that “the new bank which will lend money will take some administrative and guarantee fees. So we must keep in mind that renegotiation generates a few costs.”

It is therefore not enough to have a lower rate. “But it’s good to have access to a lower rate which generates savings and which makes it possible to offset this additional cost.”

A loan can be renegotiated as many times as deemed necessary.

As for the question of whether it is necessary to renegotiate now: “I would wait a little,” advises Thomas Feuvray, “otherwise the borrower will not benefit from the potential decline to come. » And to suggest waiting until the end of June/beginning of July, this does not prevent “from asking a broker to be in the starting blocks but also from renegotiating the loan insurance”. Finally, “as long as the decision remains advantageous for the borrower, a loan can be renegotiated as many times as is considered necessary. »

Another element to keep in mind: there is no point waiting for a minimum period of time to renegotiate, from the moment you have signed. “I have had extreme cases where we renegotiated even before the first installment was repaid,” explains Thomas Feuvray. Timing is everything.

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