One of the investments favored by the French, the Housing Savings Plan (PEL) is a means of saving allowing residents in France to finance their real estate projects. It’s minimum duration is 4 years and maximum of 15 years. Despite the removal of its government premium for new subscriptions starting in 2018, the ELP still allows investors to take advantage of a loan at a preferential rate. In fact, housing savings plan financing helps to make a real estate purchase a reality, complete construction work in progress or carry out development projects. It should be noted that this investment is only available for real estate located in France. In summary, this savings product offers savers a reliable and secure solution to build up savings in order to prepare a medium-term project, particularly a real estate investment. real estate purchase at a guaranteed rate of return. This monetary savings contract is characterized by its periodic payments, either monthly, quarterly or semi-annually.
The operation of a Housing Savings Plan
The Housing Savings Plan can be opened for any individual who does not hold an ELP, a Harvest or a Messidor. Its initial payment is € 225 minimum and the payments must be periodic. That being said, the monthly deposit is at least 45 €, 135 € per quarter and finally 270 € per semester. The ceiling for ELP deposits is € 61,200 and it is possible to add additional amounts, in addition to periodic payments, up to the limit indicated. Its rate of remuneration is calculated and fixed by the Banque de France. This is known in advance and guaranteed throughout the duration of the placement.
Regarding the Housing Savings Loan
Anyone who has opened a Housing Savings Plan will have the privilege of applying for a Housing Savings Loan. At the end of the saving period and from the 4th year, the owner of a PEL can bénéficierde this loan which amounts to € 92 000 maximum, the nominal value of 3.20% excluding insurance rates. However, it must be remembered that the amount of the loan varies according to the interests of the Housing Savings Plan acquired. At the end of the ELP contract, the applicant has a period of 5 years to apply for a loan. If he does not wish to subscribe to a Housing Savings Loan, his rights are transferable to a member of his family under certain conditions.
Transforming a Housing Savings Plan into a Housing Savings Account
Throughout the savings phase, and especially as an alternative to the closing of a Housing Savings Plan before its 2 years, the saver will have the privilege of asking his advisor to proceed with the transformation of his ELP into a Savings Account. Housing (CEL). This requires the banker to recalculate interest at current CEL rates, which makes it easy to generate CEL entitlements in order to replace PEL loan entitlements. The transformation is possible on a CEL that already exists or on a CEL registered for the occasion.