Definition, method of calculation, operation, obligations... Everything is here! The APR will soon hold no secrets for you. 🤓
What is the APR?
The APR (Annual Percentage Rate) is an essential indicator when it comes to evaluating the actual cost of a loan for the borrower. It is a rate that encompasses not only the nominal rate of the loan but also all the fees and charges associated with the borrowing. Calculated according to a precise formula, the APR allows borrowers to compare different loan offers and make informed decisions. It is often talked about in the context of a rental investment.
Good to know 💡 : Before October 1, 2016, we used to talk about the APR (annual percentage rate). This change was made to provide more clarity and to be able to compare loan options more easily.
How to calculate the APR?
The APR is calculated using the following formula:
→ APR =[(total amount to be repaid - loan amount)/loan amount] x number of installments.
⚠️ the APR cannot exceed the usury rate.*
*The usury rate, also called the threshold of usury, is the maximum rate allowed for granting a loan. It is set using an equation imposed by the European Parliament.
Cette précision évite une confusion très fréquente. Les frais de notaire, par exemple, pèsent fortement sur le budget global d’un achat immobilier, mais ils ne relèvent pas du TAEG du crédit en tant que tel. Ils concernent l’opération immobilière, pas le coût du financement bancaire au sens strict. Ce distinguo est essentiel, parce qu’il permet de comparer correctement deux offres de prêt sans mélanger le coût du crédit et le coût total de l’achat. On constate souvent que les comparaisons les plus bancales viennent justement d’un mauvais périmètre de calcul.
What are the components of the APR?
As previously mentioned, the APR includes all costs related to a loan. So we find:
The nominal rate
The nominal rate corresponds to the rate that the bank will assign to a loan; it varies depending on the situation and the borrower's profile.
The duration of the loan
The duration of the loan is also to be considered when calculating the APR. Good to know 💡: The maximum duration of a loan for a property investment (rental investment or primary residence) is 25 years. However, the duration of a loan for a rental investment is around 20 years.
Cost of insurance
Borrower insurance also represents a cost! The good news? There is a complete article dedicated to this topic. It's right here 👈🏻.
Processing fees
Processing fees are all the administrative costs related to the opening and management of a file.
For an online bank, the processing fees are zero.
For traditional banks, the fees range from €350 to €1000.
For specific cases, the processing fees can go up to 1% of the loan amount.
Guarantee fees or real security:
⚠️ A bank never takes risks! For this, there are several guarantee solutions.
The guarantees are what are called, in more legal language, securities.
In the case where the borrower brings a guarantee:
They can pertain to tangible assets (this is the case with a mortgage) or intangible assets (this is the case with a pledge): this is what we call real securities.
They can also pertain to individuals (this is the case with surety) and in this case, they are personal securities.
In the event that the borrower does not provide collateral:
They can take out a guarantee from a surety organization. These are subsidiaries of large banks that act as guarantors to the banks in case of insolvency.
On average, this represents a charge of 1% of the borrowed amount.
Le contexte réglementaire renforce encore cette exigence de précision. Le taux d’usure, fixé trimestriellement par la Banque de France, encadre le taux maximal auquel un crédit peut être accordé. Cela signifie qu’un prêt trop chargé en frais ou en assurance peut se tendre plus vite qu’on ne le pense. Dans un marché où les conditions d’octroi restent surveillées, la lecture détaillée du TAEG n’est donc pas seulement utile ; elle devient structurante dans la décision.
What are the obligations of banks?
Prohibition to adapt their calculation method: the APR is calculated in the same way regardless of the banking institution.
Prohibition to exceed the maximum usury rate
Obligation to indicate the APR in advertisements and loan contracts.
In the event that a bank does not indicate the APR or that the indication is incorrect, a judge may cancel all or part of the interest on this loan. This depends on the damage suffered by the borrower.
En réalité, la seule base fiable reste le dossier remis par la banque : la FISE, les conditions d’assurance, l’offre de crédit et le détail des frais exigés. C’est aussi ce qui permet de vérifier si le prêt reste cohérent au regard du taux d’usure et des règles applicables. Là encore, le bon réflexe n’est pas de faire confiance à un seul chiffre isolé, mais de confronter ce chiffre aux pièces qui l’expliquent.
Ce qu'il faut retenir
Le TAEG immobilier n’est donc pas un détail technique réservé aux spécialistes. C’est l’outil qui permet de voir ce que coûte réellement un financement, d’éviter les comparaisons trompeuses et de remettre chaque offre à sa juste place. Quand on comprend ce que ce taux recouvre, comment il se calcule et quels frais il doit intégrer, on lit une proposition bancaire avec beaucoup plus de recul. Et c’est précisément ce recul qui fait souvent la différence entre une offre simplement rassurante et une offre réellement avantageuse.
