A third of the French currently repay a mortgage and according to the credit broker Finance yourself a third of them are currently having difficulty repaying this loan. Charlie Cailloux, legal advisor for the real estate site PAP.fr, gives us its light.
franceinfo: What is the procedure to follow in this case?
Charlie cailloux : You must contact the bank, if possible before the first unpaid. Like any creditor, the bank will be more inclined to give you a payment facility if you don’t face it.
There are two solutions: the first is to modulate (therefore to temporarily lower the amount of the monthly payment); the second is simply to postpone deadlines. And the first thing to do before asking your banker is to check if there is a clause that allows you to do so or if you are going to have to convince the banker to grant it to you.
Is it better to modulate or postpone?
The best is to find a solution with the banker, but it is true that modulation costs less than deferral. It is easy to understand: deferral extends the duration of the loan more than modulation. To see the additional cost, you can ask your banker for a new simulation of the total cost of your mortgage.
Modulation, postponement … the third solution is the consolidation of credits!
Yes, this is also called credit redemption. The situation is the same: a household which, following a drop in income, can no longer cope with its various loans (real estate, consumption, car, etc.). Well, we can combine all the credits into one. The advantage is that you will then have only one, reduced monthly payment to pay. The problem is that the duration of the credit is greatly extended and therefore the cost of credit (the total amount of interest paid) will automatically increase.
We take out insurance during the loan to protect ourselves in the event of an accident of life. Can they help?
All borrowers must take out insurance against the risk of death, disability and incapacity for work. Far fewer people take out job loss insurance because it’s quite expensive, there are waiting periods and deductibles, and basically only redundancy is covered. But of course, if you have purchased such insurance, now is the time to activate it.
Is there financial assistance for borrowers who are struggling to repay their credit?
If you are an employee and you experience a drop in income of at least 25%, you can contact Action Logement, which can grant you a reduced rate loan under conditions to allow you to refinance. You can also contact your departmental housing information agency who can guide you.
What if we can’t find an agreement with our bank?
There remains the possibility of seizing the litigation and protection judge to request a grace period which may be granted in particular following the dismissal of the borrower. And if that is not enough, it will be necessary to seize the commission of over-indebtedness.