No payment to the borrower
Know firstly that in any case, the settlement of the mortgage can not be made to your order. The bank will release the funds directly to the order of the notary if you buy an old home or send a payment to the developer if you buy a new home with each call for funds, in accordance with the reservation contract attached to the loan offer.
On the other hand, the disbursement of the funds is the fact triggering the payment of interest on the mortgage. It must intervene within 4 months after the signing of the prior offer.
Case of successive releases
If you plan to borrow to carry out work in your home or if you buy a new property (principal residence or rental investment), the release of funds will be done in a successive way. You will then have to pay the interim interest, that is to say the share of interest corresponding to the amount released by the bank.
Numerical example of fund calls
Imagine that you borrow 200,000 euros to 4.5% for the purchase of a new apartment off-plan (sale in future state of completion) and that the disbursement is made according to the diagram below. (We simplified the calculation on the assumption that calls always took place on the 1st of a month). Just like a loan in fine, the borrower only pays interest until the last release.
|January 1, 2012||Signature of the reservation contract||5%||€ 10,000|
|May 1, 2012||Opening of the site||20%||40 000 €|
|July 1, 2012||End of foundations||10%||€ 20,000|
|December 1, 2012||Floor 2nd floor||10%||€ 20,000|
|may 1st, 2013||Out of water||20%||40 000 €|
|August 1st 2013||Out of air||20%||40 000 €|
|1st October 2013||Completion of the works||10%||€ 20,000|
|December 1, 2013||Return the keys||5%||€ 10,000|
Cost of interim interest
|January 1, 2012||€ 10,000 X 4.5% X 4/12||150 €|
|May 1, 2012||€ 50,000 X 4.5% X 2/12||$ 1,125|
|July 1, 2012||€ 70,000 X 4.5% X 4/12||€ 1,050|
|December 1, 2012||€ 90,000 X 4.5% X 5/12||€ 1,687.50|
|may 1st, 2013||€ 130,000 X 4.5% X 3/12||€ 1462.50|
|August 1st 2013||€ 170,000 X 4.5% X 2/12||$ 1275|
|1st October 2013||€ 190,000 X 4.5% X 2/12||$ 1425|
|December 1, 2013||Amortization of capital||–|
As can be seen from this example, interim interest is expensive for the borrower, who will have to pay out more than 8,000 euros before starting to depreciate the capital.
If you have a cash flow problem, you can ask the bank to incorporate the interim interest in the home loan. They will then be repaid over time and will not enter into the calculation of the debt ratio.
Attention in case of insurance delegation
If you subscribe to the group contract, the bank will take care of the contract edition. On the other hand, if you opt for an external insurance, it is you who will have to make sure that everything is in order on the day of the disbursement and in particular to the edition of the delegation, the particular conditions and the definitive contract.