The Banque de France ready to return to quarterly updating of usury rates

"Now, interest rates are tending towards stabilization: this is true of the ECB rates (on pause since September) as well as those of the livret A, maintained at 3%. It is therefore justified to emerge from exceptional circumstances and to return to the quarterly adjustment provided for by law", indicated the Banque de France in a statement to AFP.

Usury rates are ceiling rates set by the central bank based on the rates charged by banks over the previous three months. They aim to protect the borrower against over-indebtedness.

The usury rate for mortgages over 20 years old will, for example, increase to 6,11% from December 1, according to a publication in the Official Journal on Wednesday.

Previously calculated every quarter, the usury rates have been updated every month since the start of the year, with banks and brokers judging the previous system too slow to adapt to the rapid tightening of monetary policy, and therefore to the rise in rates.

Scheduled to last until July, this monthly payment was finally extended until the end of the year.

After a significant increase that began at the start of last year, the rates charged by banks for real estate loans are falling, according to data from the Banque de France, the Crédit Logement Observatory and brokers.

They were on average between September and November 4,58% for a loan over 20 years according to the Banque de France, well below the usury rate.

Real estate credit crystallizes opposition from certain market players, such as brokers, and the Banque de France.

The rules for granting this segment of credit are reviewed each month by a college chaired by the Minister of the Economy Bruno Le Maire, the High Financial Stability Council (HCSF).

The next HCSF meeting is scheduled for December 4.

“Possible new technical adjustments will be studied there, provided that they do not lead to an increase in the risk of over-indebtedness,” warned the governor of the Bank of France, François Villeroy de Galhau, on November 17.