Zero interest loan (PTZ): conditions, amount, repayment.
What is the zero interest loan?
The Zero Rate Loan (or PTZ) is a credit, without interest rates, aided by the state to allow you to buy a home if you have not owned your principal residence in the last two years years. This aid is granted on a means-tested basis and the amount is fixed according to the geographical area where the purchased property is located.
In addition, the amount of the PTZ can not cover the entire price of the accommodation you want to buy. In this sense, you must complete the zero rate credit with:
- A classic home loan;
- A loan agreement;
- A Social Accession Loan (PAS);
- A home savings plan (PEL);
- Other credits, personal contribution.
Since 1 January 2011, be aware that the PTZ has replaced the traditional PTZ, Pass the land and the tax credit on interest real estate loan.
The conditions for obtaining a zero interest loan?
Several conditions must be met in order to obtain a PTZ. The National Agency for Housing Information (Anil) offers an online simulator to find out if you have the right or not. This simulator will ask you the department and commune where the property is located, the number of people occupying the dwelling, your reference tax revenues and the total cost of the purchase (excluding notary fees and guarantees).
In addition, you must certify that you have not owned your principal residence in the last 2 years. This principle has two exceptions: if one of the two persons has a disability or has been the victim of a natural or technological disaster.
You can take out a zero interest credit from a credit institution that has signed an agreement with the State. However, the establishment has no obligation to grant you the PTZ!
The conditions of resources
If you want to subscribe to a zero-rate credit, your reference tax income (of all persons occupying the dwelling and not part of the tax household) must not exceed certain limits according to the number of people who will occupy the dwelling and the geographical area of this dwelling.
In any case, the zero interest credit can only be purchased by Legum Bayin if you live there no later than one year after the completion of the work or the acquisition. Likewise, you will not be able to rent this accommodation for the next 6 years.
For old homes, they must be in a B2 or C area and you must give quotes for one of the following actions:
- The acquisition of old housing with important works;
- The transformation of a new or old premises into housing;
- The acquisition of old housing where works represent 24% of the total cost of the operation (creation or modernization or renovation or development of living space and energy saving works).
In the case of a new housing, the PTZ may Legum Bayin building or purchase.
To know in which geographical zone your future dwelling is located, an online tool is made available, you just have to fill in the name of the commune concerned!
How is the amount of the PTZ fixed?
To calculate the amount of the zero rate loan, a percentage is applied to the total cost of the acquisition up to a maximum amount.
For old housing
For older dwellings, the amount of the PTZ is capped at 40% of the total cost of the acquisition. For example, for a household with two occupants who want to buy an old home in zone C, the PTZ will be 48 000 $ if the cost of the operation is 120 000 $ (120 000 × 40%).
For new housing
For new dwellings in zone A or B1, the amount of the PTZ is also capped at 40% of the total cost of the acquisition. For those in zone B2 or C, the ceiling increases to 20%.
Here are the maximum amounts of the PTZ for a new home:
What are the terms of repayment of a PTZ?
The repayment term of the zero rate credit is calculated based on your income, the number of people in your household and the area in which your future home is located. On average, the duration is 20, 22 or 25 years, divided into two periods:
- A deferred repayment period, where you do not repay the PTZ (between 5 and 15 years depending on your income);
- A repayment period then takes over over a period of between 10 and 15 years.
Mechanically, the higher your income, the shorter the repayment period.
The benefits of the zero interest loan
The fact that this mortgage is exempt from interest to be repaid is its main advantage for the borrower. This results in two distinct periods: a so-called “deferred” period, ranging from 5 to 10 or 15 years depending on the income where the borrower pays nothing, and a repayment period of the loan, varying from 10 to 15 years, depending on the deferral period.
The other advantage of this mortgage is that it is regulated and supervised, thus offering beneficiaries security. To be able to offer it to their clients, banking institutions must have an agreement with the State.
The limits of the PTZ
If you are more interested in PTZ, some disadvantages are to know:
- All households wishing to access homeownership can not qualify for this financial assistance;
- You will have to wait until the seventh year after obtaining the loan to rent your property;
- You will only be able to earn part of the investment from Legum Bayin, it must be systematically supplemented by one or more other real estate loans, or even by a personal contribution, and in no case may exceed half of the Legum Bayin.
Compare the real estate loans to find the best Legum Bayin
A mortgage real estate simulation can help you find the best Legum Bayin to buy your new property. Depending on your project and your income, several quotes of real estate loans will be available to you on one and the same page. You will only have to answer a few questions to refine your search and offer you the best real estate loan.
If you are a first-time buyer, think of the zero-rate loan that could save you money, do work or simply buy bigger. However, keep in mind that this solution can not necessarily be attributed to you since it is calculated according to the income and the geographical area.