French property owners face financial strain

A YouGov study conducted for Meilleurtaux in late September found that half of French people believe they cannot cover a major expense with their current income and savings. This figure rises to 55% among those aged 65 and over, highlighting a growing financial insecurity among older adults.

New credit option targets asset holders

To help address this issue, Meilleurtaux, a financial broker, plans to launch a new service called "patrimonial credit" in October 2026. This product allows individuals to borrow money using their assets as collateral without needing to sell them, offering a way to access funds while retaining ownership of their property or investments.

Three distinct borrowing methods

The "patrimonial credit" includes three types of financing. The first, a cash mortgage loan, is designed for property owners aged 45 to 75. It allows borrowing secured by real estate, which can be used for home improvements or donations. The borrower repays the loan monthly, similar to a standard loan.

Reverse mortgage offers no monthly payments

The second option is a reverse mortgage loan, aimed at those aged 60 and over. This type of loan requires no monthly payments. Instead, the borrowed amount and accumulated interest are repaid when the property is sold or after the borrower's death, typically by their heirs as part of the estate.

Liquidity from life insurance policies

The third option allows borrowers to access liquidity based on their life insurance policies without selling the underlying assets. This provides a way to use financial investments as a source of funds while keeping the assets intact.

Interest rates and repayment terms

Meilleurtaux states that the financing options range from 50,000 to 750,000 euros, with repayment terms that can extend up to 25 years. Interest rates range between 5.5% and 7%, though fees are not included in this range. For reverse mortgages, interest accumulates over time, potentially increasing the debt significantly.

Legal protections for heirs

Despite the potential for rising debt, heirs of borrowers are protected by law. The debt owed at the end of the loan cannot exceed the value of the real estate, ensuring that the estate passed on is not burdened by excessive debt.