Rising credit costs threaten French borrowers

The rising cost of credit in France is causing concerns among real estate borrowers, with nearly 230,000 borrowers at risk of exclusion due to the 4% rate over 20 years. The increase in credit rates is linked to the country's growing debt, which has led to fears of a sharp rise in rejected loan applications.

Expert expresses frustration over credit trends

An expert in real estate brokerage expressed frustration, stating, "Credit rates will continue to rise. Thank you, the wreckers!" This remark highlights the growing concern among professionals in the sector about the long-term impact of rising rates on the housing market.

Urban violence indirectly affects credit costs

The urban violence on October 17 is not directly responsible for the higher cost of credit but contributes to it. The scenes of looting and destruction that occurred last weekend reflect a sense of helplessness from the state and may lead to new expenses for repairs or gestures aimed at calming public anger.

Investors drive up French loan rates

Investors are increasing the 10-year loan rate of France (OAT), which has now exceeded 5%, a first since 2002. Julie Bachet, general director of the broker Vousfinancer, remarked that "A 5% OAT is a strong signal!" This increase reflects growing uncertainty about the country's financial stability.

Banks reduce margins to keep lending

Typically, banks lend at a rate higher than the 10-year OAT. However, currently, the average credit rates hover around 3.7% over 20 years (excluding insurance), which is more than one point below the French debt rate. In practice, banks are reducing their margins to continue lending.

Future credit rates remain uncertain

Julien Langlade, president of the broker Cafpi, noted that this situation cannot last indefinitely and questioned whether average credit rates above 4% might soon become a reality. His comments suggest that the current lending practices may not be sustainable in the long term.