You are planning to take the plunge and build your home. This type of project requires a certain amount of preparation, reflection, and an appropriate budget so that the expected result meets your expectations. However, your budget may be tight, and you may require a little help. In this case, financial aid is available!
Why Set up the Financial Aid?
The State and some public organizations have set up this action to give a financial boost to people who need to complete their budget. Indeed, many financial aids are mainly intended for families with modest and average incomes and who want to access a property. In addition to this financial aid, interest rates are consistently low, and builders will facilitate their clients’ projects by helping them find their credit. This is possible because some builders have set up partnerships with banks, and others have developed financing brokerage activities.
What Are These Different Financial Aids?
The Zero Rate Loan or PTZ
This is the primary aid for homeownership granted by the State. Its objective is to help households who wish to acquire a home for the first time or have not owned their home during the last 2 years. It should be noted that the PTZ is a loan granted by banks that have signed an agreement with the State. Generally, it works exactly like other loans, except that the borrower does not pay interest on the monthly payments. In other words, it is free credit. The zero-interest loan can represent up to 40% of the amount of your project.
The Social Accession Loan or PAS
This is also a real estate loan granted by banks that have signed an agreement with the State. Like the zero-interest loan, it is exclusively intended to finance the principal residence, whether by purchase or by construction. What differentiates them is that the PAS is granted under resource conditions and that the ceilings are not the same. The advantage of the social action loan lies in the fact that you only pay back the interests of the loan during the whole duration of the work and that the borrowed capital is only paid back when you move into your new home.
The Action Logement Loan
If you work for a private company with more than 10 employees, you can benefit from the Action Logement loan. This is an exciting financing solution because it allows you to obtain up to €40,000 in loans with an annual nominal interest rate of 0.5%. And the duration of the Action Logement loan can be up to 25 years. You can ask your company’s personnel department for information if you consider obtaining it.
The various housing savings schemes are also attractive financing solutions. You need a home savings account (CEL) or a home savings plan (PEL) to qualify for a loan to supplement your contribution. In this case, if you have, for example, a housing savings plan open since August 2016, you can obtain a loan of 92,000 € repayable over a maximum of fifteen years with a rate set at 2.2%. The advantage of this financing is the ease of obtaining the loan, as it constitutes a personal contribution.
Local Government Aid
Local aid may also be available for your project, such as the exemption from property tax granted during the first two years following the declaration of the property. For more information, you can consult the website of the departmental housing information agency (ADIL) of your department.
Help From Relatives
Whether increasing your contribution or creating a family loan, assistance from relatives is also an alternative when building a new home. You can benefit from donations or family credits. The donation is made by the parents and can be up to 100 000€ without paying taxes. The family loan is also interesting, provided that certain formalities are respected. It must be in writing for more than 1,500€, and this deed must be registered with a notary to reinforce the legal security of the loan.