35 % of your income, and not a point more

The Marchand couple earn 4 800 € net a month and are aiming at a 1 900 € monthly payment. No bank will follow: the rule caps the burden at 1 680 €. This is not a commercial policy, it is a decision binding on the lender. Before you read on: what are those 35 % computed on, and what must be included?

A prudential rule, not a banker's preference

The decision of the High Council for Financial Stability has governed the granting of mortgages since 1 January 2022. It provides that borrowers' debt burden must not exceed 35 %, and that the maturity of the loan must not exceed twenty-five years.

The distinction matters to a borrower who is negotiating. This cap is not something to argue over with an adviser: it binds the institution, which must justify any departure in writing and answer for its practices to the prudential supervisor.

The debt burden compares total borrowing charges with income. Those charges include the borrower's insurance and any loans already running, not merely the payment on the loan under consideration — which is what quick simulations most often leave out.

From monthly payment to borrowable capital

The cap gives a monthly payment, not a purchase budget. Moving from one to the other requires the rate and the term: at 3.60 % over twenty years, a payment of 1 350 € corresponds to roughly 220 000 € of capital, insurance included.

Lengthening the term raises the capital available, but less quickly than people expect and at a rising cost. Every year added swells the total interest, so the same property bought over twenty-five years costs appreciably more than over twenty.

A deposit works on a different lever. It does not raise the payment cap, which depends on income alone, but it reduces the capital to be borrowed — and it covers the acquisition costs, which banks rarely finance.

This is the point many buyers discover at the last moment. On a 260 000 € purchase the costs come to more than 18 000 € to be found out of pocket, on top of the deposit the institution expects on the price itself.

Twenty-five years, save two years of deferral

The twenty-five-year maturity admits one precise exception, and it is worth knowing. It can be raised to twenty-seven years where entry into the property is deferred: new build, sale before completion, or purchase of an older property with works.

The works case is conditional: they must represent at least 25 % of the total cost of the operation. Below that, the exception does not apply and the maturity stays bounded at twenty-five years.

In every case the amortisation period itself stays capped at twenty-five years. The two additional years do not lengthen repayment: they cover the deferral during which the property has not yet been delivered.

The flexibility margin, and who benefits from it

The cap is not absolute. Institutions have a quarterly flexibility margin of 20 % of their lending, within which they may exceed the debt burden or the maturity.

That margin is earmarked, and this is what few borrowers know. It is reserved 80 % for the purchase of a main residence, that is 16 % of lending, and at least 30 % of that share goes to first-time buyers.

That leaves 4 % of lending genuinely free of allocation. A buy-to-let investor exceeding the cap competes for that narrow slice, while a first-time buyer of a main residence has a dedicated corridor.

The practical consequence is direct: asking to exceed the cap is entirely legitimate, but the outcome depends on where one sits in that allocation, and on the quarter. The same request refused at the end of a quarter may pass in the next.