As of June 1, the Lemoine law allows borrowers to no longer have to fill out a medical questionnaire in order to obtain a loan of less than 200,000 euros alone or 400,000 euros in pairs. This form has so far been requested to set the amount of your borrower insurance. But its suppression is not necessarily a good news for you. We explain why.
This is a major change that will take effect on June 1. Published in the Official Gazette on March 1, the Lemoine Act aims to provide “fairer, simpler and more transparent access to the borrower insurance market and simplify borrowing conditions for real estate acquisition.” indicates the official website of the administration française.
Clearly, the measure allows some of the former cancer patients or hepatitis. On the other hand, it removes the health questionnaire for loans of less than EUR 200 000 for a single person or EUR 400 000 for couples. The latter was usually requested before the loan was issued in order to calculate the amount of the borrower’s insurance.
A measure “pushed by banks”
In short, “the official goal is to give more rights for people with health problems “said Pierre Chapon, co-founder of broker Pretto. Several laws of perverse effects: a risk assessment plus difficult for insurers, which should lead to a significant increase in the value of insurance borrowers. According to Moneyvox, it is being evaluated about 20%.
Some in the industry cite a “bank-driven” measure to weaken competition. Indeed, the latest proposals, these and the borrowers’ insurance are generally less competitive for the insurers. “With this measure, while some insurers are retiring in the market for these small loans, while others increase their prices,” confirms Pierre Chapon.
And who says increase in borrower insurance, says increase in upcoming monthly payments. Not necessarily good news for those who want to subscribe to these small and medium credits that concern „50% of the real estate market and almost all first-time buyers“, points out the broker.
In an already difficult context with strong credit rates, rising in recent months and now mandatory debt rates capped at 35%, the vise is tightening even more for borrowers. “We will see the impact of the Lemoine law within three months, but we can already expect a significant slowdown in the number of credits granted,” said Pierre Chapon. “The combination of all these factors will inevitably create blockages.”
A termination of the borrower’s insurance facilitée
As stated by service-public.fr, this law also opens up the possibility of termination and change at any time borrower insurance, free of charge. Several texts had gradually allowed this solution to facilitate the renegotiation of the conditions of the insurance in order to benefit from a better rate, but it was still little used for people taking out a real estate loan. “
And for good reason, until then it was only possible to terminate his insurance on the anniversary date.
From now on, “every year, insurers will have to inform their policyholders of this right of termination. They will also have to communicate the cost of borrower insurance for eight years,” says the official website of the French administration.