What is this new loan to help you renovate your home?

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The state has pulled out of the closet aid that had existed since 2015 but had never been used. Will banks offer it to their customers?

Better support households and reduce their out-of-pocket costs as much as possible (which they have to pay out of pocket). It is in these two areas that the government must improve to encourage the French to renovate their homes. For the first, the executive promised to set up a kind of one-stop shop: each beneficiary of Ma Prime Rénov ‘, the new financial aid to finance energy works, will have to be monitored by a third party – private or public – who will explain what work to do, which craftsmen to contact and how to get help. Total cost? 1600 euros per accommodation. An ambitious project knowing that the government is targeting 700,000 to 800,000 requests for 2021.

The executive must also do better when it comes to funding. My Prime Rénov ‘is successful but the average aid barely exceeds 3000 euros. A little weak to renovate a home from top to bottom. Moreover, the government does not hide it and encourages households to also seek private aid. What to give some headaches to the French. The executive also put in place a new loan to help households that cannot afford to carry out energy renovations.

In reality, it is not really new. It is a device which has been provided for by law since 2015 but which has never been used by banks. Her name? The advance transfer loan (PAM). Concretely, if you do not have the means to pay your share as part of a comprehensive renovation, you can request this assistance guaranteed by a mortgage (up to the amount of the loan plus interest).

The State grants its guarantee

You receive it in the form of periodic payments and only repay the interest each month. The capital will be once the property is sold or transmitted by inheritance. For a loan of 10,000 euros at a fixed rate of 2%, the interest charges would amount to 17 euros per month, according to the estimates of Olivier Sichel, number 2 of the Caisse des Dépôts which proposed this PAM in a report returned to the government last March. The cost would be a little over 37 euros for a loan of 30,000 euros granted at 1.5%.

The government has therefore decided to bring out of the closet an aid that is intended for modest or elderly owners or even who have a thermal strainer (numbering 4.8 million in France, Editor’s note) and who often have difficulty obtaining credit. And this is where the shoe pinches for the banks: are these populations solvent? Banks are supervised by the financial authorities who impose increasingly strict conditions on them.

To deal with any default in repayment, the State has promised to grant its guarantee which will be set at 75% of the possible loss if the proceeds from the sale of the property do not make it possible to reimburse the “remainder to be paid” by renovations. It remains to be seen whether this gesture will convince the banks. For now, two establishments have committed to offering this loan to their customers at the start of 2022: Crédit Mutuel and Banque Postale. The other terms of this loan, and in particular the means test, must be finalized by the end of the year.

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