Month: April 2020

Zero plus rate loan (PTZ +): all you need to know

by admin


Want to know all about the zero plus loan rate (PTZ +)? Created in 1995 and intended to facilitate access to property, the zero interest plus loan has many advantages (no application fees and no interest). 

What is the zero plus loan rate?

What is the zero plus loan rate?

The zero interest plus loan, called “interest-free loan” in the legal texts, aims to promote home ownership. Since 2011, it replaces the old zero rate loan (set up in 1995) as well as the property pass and the tax credit on mortgage interest. It takes into account the geographic area of ​​the accommodation concerned and the real needs of the applicant. The PTZ is a State-assisted loan, allocated throughout France (mainland and overseas departments).

It can be used to build your main residence. This, in order to acquire new housing. Since January 2015, the zero rate plus loan has also applied to old housing.

It can also finance various operations, depending on whether the property has already been inhabited (if you are in social housing or in old private sector housing) or not (in the case of housing to be built or the transformation of a local accommodation).

Special case: households having acquired real estate before December 31, 2010 remain beneficiaries of the tax credit.

What are the features of PTZ +?

What are the features of PTZ +?

The advantages of PTZ + are its simplified implementation and its ability to obtain accommodation for the applicant in the areas where they are the most expensive. Above all, the PTZ + is guaranteed interest-free, no application fees and expert fees.

However, it is impossible to subscribe only to a PTZ +. It must be added to one or more additional loans, intended to finance a mortgage. Among them :

  • The housing action loan
  • Social accession loan (PAS)
  • The loan under agreement
  • The bank mortgage
  • The home savings loan

How to subscribe to a PTZ +?

How to subscribe to a PTZ +?

The zero interest plus loan can be taken out with banking establishments that have signed an agreement with the State. They are responsible for calculating your ability to repay a credit (this is the creditworthiness) and your guarantees. However, it should be noted that no establishment is forced to grant you a PTZ +.

What are the conditions?

You must be a first-time buyer , i.e. not have been the owner of your main residence during the last two years preceding the loan. However, you can own one or more secondary residences (rental investments or shares in a SCPI).

Specific cases

Although it is attributed to first-time buyers, the Construction and Housing Code provides for some exceptions. Therefore, if you meet the conditions below, there is no need to be a first-time buyer.

  • If you, or one of the inhabitants of the accommodation receive a disabled adult allowance (AAH) or a disabled child education allowance (AEEH). You must justify it with a 2nd or 3rd category disability card or inclusion mobility card attesting to the mention of disability.
  • If you are the victim of a natural or technological disaster, making your main residence an uninhabitable place. It is therefore imperative to apply for the loan two years after the certificate attesting to the loss.

In addition, you must live in the accommodation concerned by the loan at least 8 months per year. Except for :

  • Health reason
  • In case of force majeure
  • In case of professional activity resulting in regular trips
  • In case of rental accommodation (attention, subject to specific conditions)

What are the elements to take into account?

  • The nature of the accommodation: in the case of low-cost housing, new or old property (the work of which is estimated at 25% of the total cost of the operation)
  • The geographic area of ​​the property: zone A, B1, B2, C
  • Household size and subscriber resources
  • The amount of the acquisition
  • Person contribution


What are the means test?

In order to qualify for the zero plus rate loan, the resources of the applicant household must not exceed a certain ceiling. This ceiling depends on the area of ​​the accommodation concerned, the resources of the home and its composition.

In addition, the tax revenue of the applicant and of the other persons who will live in the accommodation are recorded (in the event of a separate tax declaration). More specifically, these are the tax revenues obtained the penultimate year preceding the loan (year N-2).

For example:  for a loan contracted in 2020, the fiscal year taken into account is the year 2018, for income declared and paid in 2019.

Finally, the amount of estimated resources corresponds to the highest amount between  the sum of tax revenues and  the total cost of the operation  divided by 9.

Maximum resource ceiling, depending on the geographic area and the size of the household

Number of occupants Zone A bis and A Zone B1 Zone B2 Zone C
1 $ 37,000 $ 30,000  $ 27,000  $ 24,000 
2 $ 51,800 $ 42,000 $ 37,800 $ 33,600
3 $ 62,900 $ 51,000 $ 45,900 $ 40,800
4 $ 74,000 $ 60,000 $ 54,000  $ 48,000
5 $ 85,100 $ 69,000 $ 62,100 $ 55,200
6 $ 96,200 $ 78,000 $ 70,200 $ 62,400
7 107 300 $ $ 87,000 $ 78,300 $ 69,600
From 8 $ 118,400 $ 96,000 $ 86,400 $ 76,800


How is the amount of PTZ + calculated?

How is the amount of PTZ + calculated?

The PTZ + is intended to finance part of the total cost of the operation (inclusive of tax). This total cost is capped according to the geographic area of ​​the accommodation concerned and the size of the household that will live there.

It includes the amount of the construction or the acquisition of the real estate (works included, excluding eco-PTZ +), without counting the negotiation costs in agency. However, notary fees are not included.

The amount of the PTZ + depends on a percentage applied to the total cost of the operation:

construction cost ÷ purchase + negotiation costs

This percentage represents 40%  of the cost of the operation for new and old real estate (regardless of the area) and 10%  of the cost of the operation for housing in the social housing stock.

Maximum amount of the total cost of the operation depending on the geographic area and the size of the household

Number of people living in the accommodation Zone A bis and A Zone B1 Zone B2 Zone C
1 $ 150,000 $ 135,000 $ 110,000 $ 100,000
2 $ 210,000 $ 189,000 $ 154,000 $ 140,000
3 $ 255,000 $ 230,000 $ 187,000 $ 170,000
4 $ 300,000 $ 270,000 $ 220,000 $ 200,000
5 and more $ 345,000 $ 311,000 $ 253,000 $ 230,000

How long is the repayment period?

How long is the repayment period?

The duration of repayment of the loan at zero rate plus is calculated according to your income, the total cost of the operation, the size of your home, the type of your accommodation and its geographic area.

Thus, the higher your income, the shorter the term of the loan. The repayment period is 20 to 25 years depending on the case. It includes two phases:

  • The deferral period: you do not reimburse the PTZ +. It is estimated at 5, 10 or 15 years depending on your income.
  • The loan repayment period: begins once the deferred period has ended. This phase fluctuates between 10 and 15 years.

 Repayment terms may be revised. This is the case when:

  • The repayment period is equal to or less than 8 years. The applicant can then reduce the amount of his loan (up to a limit of 50%).
  • If the PTZ + includes a refund in two periods. The first can be reduced at the request of the borrower (within a minimum of 4 years).

Indebted as a student – solve your financial problems

by admin

The current debt of all students is already twice as high as 5 years ago. On average, a student with financial problems has $ 1755 to give away.


National Debt Register statistics are worrying

student debt

Where does this group's debt come from? When choosing paid studies, you must pay tuition fees regularly. Unfortunately, some students sign a contract, pay the first installment, and they can't afford another one.

According to the information provided by the National Debt Register, the number of educational debtors together with their total debt increases from year to year. Five years ago, indebted students had 5,192 unpaid tuition bills. Today this number already reaches 15,486 commitments.

The debts of students are not only due to arrears at private universities, it is public schools that account for almost 2/3 of outstanding student commitments. One thing is certain - most of the financial problems result from debts to universities.

Allan Backi, president of the National Debt Register of the Economic Information Bureau, reminds that financial discipline is a valuable skill at any age.

  • You need to start learning as soon as possible, because bad habits will take revenge in adulthood. The first step is regular payment of tuition fees. This rational approach will pay off later when young people want to take out a loan for an apartment or their own business. However, when they have unpaid liabilities and are entered in the register of debtors, the bank will not grant them credit or loan. And this complicates the life of email - he says.


How much and who are the students guilty of?

student loan

  • total debts to public universities, schools and training centers amount to $ 9.9 million
  • financial arrears to private universities are $ 6.2 million
  • on average, a public student must give $ 3,026 in public institutions
  • in the case of private centers - $ 1,046

The indebted can be divided into two groups:

  • university students - their total debt is $ 12.3 million
  • students of post-secondary schools and training centers - the liabilities of this group reach $ 3.8 million


Why do students get into debt?

Why do students get into debt?

There can be many reasons for the financial problems of students. Sometimes it is a simple forgetfulness, and sometimes high costs of living in a big city. Dormitory or study fees, unexpected visits to doctors, materials for classes, food - all this costs money. Added to this is tuition fees and ... the problem is increasing.

It also happens that students simply forget to unsubscribe from their old or interrupted faculty.

Not everyone is aware that the contract must be terminated. Even if you don't use classes, you still have to pay for your studies or course. If we assume that the monthly tuition fee is only $ 500, then $ 2,000 is collected during the semester. And this is a considerable amount to be repaid, when at the same time you have to pay the same amount for new studies. Therefore, you must remember to submit a written resignation. Otherwise, such a person may be entered in the National Debt Register, and the debt collector will request payment - explains Jaross Kospen, President of the Management Board of the debt collection company 13Kids Financials.


Portrait of a student in debt

student debt

  • people aged 26-35 have the most obligations
  • the said age group has to be given a total of $ 8.9 million
  • women have more educational debts - 67.7%
  • the largest number of educational debtors live in the Pomeranian Voivodeship (1164), Mazovia (1052) and Lesser Poland (993)

Can I refinance? New Loan Requirements

by admin

Question: I would like to find out if I can refinance my mortgage. What is needed for this?

Answer: To get a new loan, you need to apply for a new loan and qualify with your lender.

Do you qualify for refinancing?

Do you qualify for refinancing?

Before applying for a refinance, it is a good idea to determine if you would qualify for a loan. If not, you know sooner and later you can start solving any problems.

To qualify for a home loan, you need the following:

  • Decent credit
  • Sufficient income
  • Enough home equity

First, look at your credit. By law, you are allowed to order free credit reports from each credit reporting agency every year. Look for errors in these reports. Ideally, you have no late payment, and your credit is better (or better) than when you got your original loan. You can refinance with less perfect credit, but you have fewer options.

Next, see if you have enough revenue to refinance. You probably have an idea of ​​what your new monthly payments will be (if not, use a credit calculator to find out). Make sure your debt and income relationships are sufficient to qualify for a new loan.

Finally, you get an idea of ​​the relationship between credit and value. You can usually refinance without much difficulty if your credit balance is less than 80% of the value of your home. However, your credit and income can always cause problems.

Challenges of refinancing

Challenges of refinancing

If you find that you cannot refinance because lenders do not like your loan, income, or value-for-money loan, try to find a solution. If your credit or income is to blame, consider using a co-signer to qualify for the loan. That person can make lenders more secure in repayment.

If your copier has strong credit, the approval is even greater.

If you can't refinance because you don't have enough capital (or your home is underwater), research government programs. There are several refinancing programs designed for homeowners who have fallen on hard times. You can only refinance through these programs if you meet certain criteria, but it's always worth a try.

Generally speaking, government loan programs are your best bet if you cannot refinance with a bank or mortgage broker. These programs have the best conditions when it comes to credit scores and home equity.

Move forward

Move forward

Lastly, the only way to find out if you can refinance is to apply for a loan (however, you should familiarize yourself with the topics above before actually applying). When you are ready to move forward, contact the lender and begin the process.