Real estate credit – Real estate loan insurance: enhanced borrower information

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The standardized information sheet that the bank gives to the candidate for a home loan contains new information relating to the total cost of the borrower’s insurance over 8 years, the definition of invalidity, the abolition of the medical questionnaire under certain conditions, and the possibility of subscribe to the borrower’s insurance of their choice.

When you apply for a loan for a real estate purchase, you must take out borrower insurance covering this loan. Beforehand, the bank must provide you with a standardized information sheet which specifies in particular the guarantees and the criteria for taking charge of this insurance, its price, or the possibility of choosing another insurance if it covers the same risks as that of the bank. The aim is to encourage competition and reduce the overall cost of credit.

A decree of May 27, 2022 modifies the format and content of this sheet, in application of the provisions of the law of February 28, 2022 for more transparent access to the borrower insurance market (law The monk »), in force since 1er June 2022.

In addition to the information already provided, this sheet must also specify the following elements:

  • the total cost of the insurance over the first eight years from the effective date of the loan agreement;
  • the invalidity guarantee of the contract is independent of the notion of invalidity as used by Social Security or any other body competent to judge professional unsuitability. The definition of invalidity has consequences on the risk covered;
  • the medical questionnaire is no longer mandatory, if you do not borrow more than 200,000 euros (including loans taken out with other establishments), and if the last due date for loan repayment occurs before your 60e anniversary ;
  • you can take out the borrower’s insurance of your choice, different from that offered by the bank, and which the bank cannot refuse if it offers an equivalent level of guarantee. You can also cancel the insurance taken out for another equivalent insurance at any time.

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