Loss of employment, separation, accumulation of loans, drop in income… In certain temporary situations, the mortgage loan taken out can become a financial burden. His suspension can then be seen as a way to fix his finances.
Which loans are affected?
Before requesting a moratorium on your mortgage, you need to know if your bank approves it (which is generally the case), but especially if your loan contract allows for it.
There are four types of home loans that are likely to allow for a term suspension clause: fixed rate loan, adjustable rate loan, adjustable rate loan and mixed rate loan.
On the other hand, the contracts for the following loans do not provide this option: the bridge loan, the loan in penalty, the approved loan, the housing savings loan, the social accession loan, the Action Logement loan and the zero interest rate.
What is the process?
The request for suspension of your credit is made by registered post with acknowledgment of receipt. And your letter should contain a certain amount of information:
- a copy of the original loan agreement,
- the total loan amount,
- the current amount of your monthly payments,
- a statement of the reasons that prevent you from repaying your monthly payments,
- the date on which you wish to postpone the repayment of your loan.
You can then agree with your bank on a partial or total postponement. The first concerns only the capital owed (interest and insurance continue to be paid); the second relates to the capital and interest (only the insurance has to be paid). Your bank will then give you an amendment to your contract as well as a new amortization table.
What are the consequences?
A suspension of credit entails no application fees or administration fees. On the other hand, it extends the duration of your loan by aligning the months in which the payments were interrupted to the originally planned end of the latter.
It should also be noted that the extension of the duration has its limits: it cannot exceed two years or 24 monthly payments.
As for the costs of the operation, they vary depending on the time in the schedule when the postponement takes place and are explained by the fees due during the suspension. If the grace period is partial, the cost of the mortgage is added to the intermediate interest. If total, the unpaid interest generated by the interest on the mortgage will be added to the principal outstanding.