This time it is: from February 1, the usury rate – which sets the maximum rate at which banks are authorized to lend – will be published every month and not every quarter, the Bank announced on Friday morning from France
This change had been planned for a week and a meeting between the central bank and representatives of banks and brokers. This monthly review will be effective from next month and will apply until July 1st. On the other hand, the calculation of the depreciation rate will always be based on the mortgage rates applied during the previous quarter. This decision has been supported in recent days by Bercy, who must give his approval for the entry into force of the modification. In the coming days a decree must be published to formalize the measure.
An adjustment that will soften the rise in the rate
The Bank of France explains this change because it has observed it in recent months “variations in the distribution of credit distribution. Some files, pending the next significant quarterly increase in the attrition rate, are thus postponed until the beginning of the following quarter. » With the rapid increase in credit rates, several files were no longer financeable because they exceeded the attrition rate too easily. This temporary modification will thus soften the increase in usury and protect borrowers from an excessive increase.
During the last update on January 1, the attrition rate for 20-year mortgage loans was set at 3.57%. An increase still considered insufficient by many players in the sector, while the rates applied on average in December are estimated at 2.34% by the Observatori de Crèdit Habitatge-CSA and continue to rise.
This monthly usury update should not, however, completely unblock the credit market. The fault of high borrowing rates, which make credit more expensive, together with a drop in the price of goods for sale considered too low to compensate for this increase.
Source : Le JDD