Finding the best mortgage requires a lengthy preliminary research. It is necessary to negotiate with your banker, to contact other organizations to carry out simulations and to play the competition… Rather than to carry out alone these constraining steps, it is possible to be helped by a comparator of mortgage .
Personalized simulation with a mortgage loan comparator
Each project is unique , just like each borrower, which is why it is important to carry out a personalized simulation to find your mortgage. In order to achieve this, our home loan comparator therefore requests to provide a certain amount of personal information, from which it will be possible to establish a real study with partner organizations and to propose an appropriate classification.
Using a home loan comparator represents a definite time saver for the consumer. Rather than contacting himself all the organizations he knows, the home loan comparison allows him to communicate his information only once. It is then the comparator who is responsible for contacting the various partners to carry out the simulation.
Mortgage, how does it work?
A home loan allows you to acquire a property (house, apartment, land, property under construction), and to finance any work related to this property. It can be a primary or secondary residence, or even rental investment. In all cases, it is generally necessary to obtain a mortgage in order to finance the purchase (and for this, to use a comparator).
Obtaining credit takes place in several stages:
- Choice of the good to acquire and signature of the sales agreement
- Apply for a mortgage, from your bank, from competing banks, from a specialized broker or from a comparator. Note that it is possible to start assessing the rates before signing the property, but it will lack information to be offered a final and precise rate.
- The bank will then send the customer a loan offer. The customer then has 10 days minimum of reflection before being able to respond to this loan offer. It is valid for 30 days from receipt.
Note that the consumer has 45 days after signing the sales agreement to obtain the agreement in principle of the credit.
What if the loan is refused? Either the customer obtains a credit from another bank, or the sale is canceled, free of charge.
Real estate credit: rates and selection criteria
A mortgage generally engages the consumer over a long period : 15 years, 20 years, 25 years … or even 30 years in some cases, unless you have a sufficiently large initial contribution to reduce this period. Even if this mortgage can be renegotiated afterwards, especially if the rates fall, it is better to try to obtain a competitive offer from the start, by going through a comparison for example.
The minimum amount of the contribution
In general, the banks ask that the initial contribution be able to cover at least the administrative costs (very variable according to the bank) and the notary costs (8% of the loan, or 2 to 3% if it is a new home), sometimes even 10% of the total amount. The amount of the contribution therefore depends on the loan itself.
Note that having a large contribution can reduce the loan amount, and therefore its cost and the duration of repayment. However, be careful to keep some money aside , because obtaining real estate always has some surprises in mind, not to mention the cost of moving, buying new furniture, any small work to do , decoration…
In the case of a rental investment, it may not be compulsory to provide a contribution.
Credit duration and monthly payments
The duration of the credit depends of course on the loan amount and the client’s finances. Borrowing over a longer period reduces the monthly payments , but increases the final cost of the loan.
It is then necessary to calculate well according to the household and its projects. For example, having small monthly payments allows you to be able to take out another loan if necessary, such as a car loan, or simply to have a better comfort of life or to put money aside. However, the term of the credit will be longer, and the total cost higher. Our home loan comparator allows you to do several simulations.
On the contrary, some consumers prefer to concentrate their credit on a shorter duration , even if it means lowering their standard of living, in order to repay as quickly as possible.
In all cases, note that it is possible to repay the loan in advance (free or not), if the household has the necessary funds before the end of the loan.
The APR rate
This is one of the key elements to look at when choosing your home loan, and studying it in our comparator. The APR (annual effective annual rate) takes into account all the costs linked to the loan (interest, administration fees, possible broker fees or guarantee fees and borrower insurance). The APR really makes it possible to compare two credits.
It is compulsory to take out borrower insurance to obtain a mortgage, unlike a consumer loan. This insurance covers reimbursement in the event of death, disability or incapacity.
In general, it is easier and faster to take out loan insurance with your bank, but it is not compulsory. If the consumer has chosen insurance from his bank, he can decide to change it during the 1st year. Otherwise, he can change it on each anniversary of the loan.
The total cost of credit
Finally, it is very important to take a good look at the total cost of the mortgage. This is also where the importance of going through a mortgage loan comparator comes in. Indeed, it is really this amount that will determine which offer is actually the most competitive for the customer.
The importance of the profile
If using a mortgage loan comparator is so important, it is very difficult to determine in advance whether the bank will accept to grant the loan , or the amount of the rate. This is explained by the importance of the consumer profile.
For example, it is more difficult to obtain credit when you are not on a permanent contract. Finances and salary also come into play, as well as the possible holding of another loan, which can already put the household into debt.
Age is also very important. A person nearing retirement will find it harder to borrow because retirement often means lower income. Similarly, the older the client, the more expensive the death / disability insurance will be. However, an older person will potentially have the means to provide a greater contribution, unlike a young person.
Can the bank oblige to open an account at home?
Finally, another element often comes into play when you want to obtain your mortgage (whether you use a comparator or not): the bank account. Many banks ask their customers to open an account with them at the same time. Is it legal? Is this practice supervised? Does the consumer have to direct his wages on this account?
Legalization on this subject has evolved recently. A first ordinance of June 1, 2017 tried to regulate the practice: the banks had to add a clause concerning the bank direct debit. The bank could thus request bank direct debit for a maximum of ten years, with obligation of counterpart. However, this risked increasing the number of clauses of this type … the order was therefore purely and simply abolished in March 2019.
Currently, opening a bank account and direct debit are therefore part of commercial negotiation . The bank can for example request the opening of an account and direct debit for a benefit, as does the online bank, which then offers a lower rate. However, nothing prevents the client, a few years later, from changing banks.