Are you one of the tens of thousands of French people who have a real estate project every year? If so, obtaining a mortgage will be the key to becoming a homeowner, so it’s best to put all the odds in your favor. To do this, here’s a list of 5 tips for applying for a mortgage and avoiding loan rejection from banks. Find out how a mortgage application works here.

1 .Keep good records for your mortgage application

First tip before applying for a mortgage: make sure your bank accounts are in order . No overdrafts, even for small amounts, during the three months or even six months before applying for a mortgage at the bank. In the case of a small budget gap, it is better to postpone the loan application to the following month in order to show the bank a positive image, that of a serious borrower, who will be able to stick to his budget and repay his loan on time.

But increasingly, banks are demanding other specific supporting documents. In the case of building a house under a CCMI (Commercial Housing Association), in addition to the building permit, the banker will want to see all additional quotes, such as the one for the development of the building plot and the connection costs if it is in a non-residential area, outside of a subdivision.

What are the steps to take out a mortgage?

2 . Respect the 33% debt rule

 Another tip for applying for a mortgage: do not exceed 33% debt . This rule may vary depending on the bank, but in general, and especially since the new rules imposed by the HCSF (High Council for Financial Stability), you should not exceed one third of your monthly net income for the repayment of a loan or 35% including borrower insurance.

For 1 in 5 loan applications, the bank will be able to go up to 35% debt, but this will only apply to specific borrower profiles. Another new rule: the loan term can no longer exceed 25 years. Moreover, the location or general condition of the property can also increasingly play a role in the bank’s decision. Particularly in the case of a rental investment, the borrower will have to demonstrate the seriousness of their real estate project.

3 . Build up a good deposit for your mortgage application

 Ideally, it is best to have a personal contribution corresponding to 10% of the amount borrowed . This personal contribution is used to pay notary fees, guarantee fees and loan application fees. Having a contribution greatly facilitates the loan application because it shows the bank your ability to save and therefore ultimately to repay your loan.

However, there is always the option of taking out a 110% loan, meaning the bank finances the 10% that the borrower does not have in addition to the 100% of the loan. However, fewer and fewer banks are offering this type of mortgage. And, in general, the rate is much higher than a traditional loan.Having a job, and more broadly speaking, a stable professional situation, is a determining factor in obtaining a mortgage loan. Proving a regular monthly income reassures the bank about your repayment capacity. Today, borrowing with a permanent contract remains the norm.

Just because you have a permanent contract or are a civil servant doesn’t mean you’ll get a mortgage; the reverse is also true. Read also – Getting a civil servant mortgage

4 . Choose a broker to secure your mortgage application

Since every borrower’s profile is very different, it’s essential to play the competition to obtain the best conditions and thus see your mortgage application succeed. Working with a mortgage broker greatly facilitates this competition. The broker guides the borrower in their search, assists them in putting together an impeccable application, advises them on optimizing their financing plan, and negotiates the best financing conditions for them.

Since credit conditions vary from region to region, from bank to bank, and depending on the borrower’s profile, it may be useful to use the services of a bank broker to get a better loan offer. If you’re in a hurry, or if the banking system and interest rates are a real headache for you, it’s best to call on a professional.