Usury rate
The legal cap on the APRC, set and published periodically by the Banque de France, beyond which a loan cannot be granted. It protects borrowers from abusive terms but, when rates rise quickly, can mechanically exclude some profiles. Brokers watch this threshold closely to calibrate their structures.
Key points
- Legal cap on the APRC published by the Banque de France, calculated from average effective rates of the previous quarter.
- A loan whose APRC exceeds this threshold is illegal: the bank cannot grant it.
- During rapid rate rises, the threshold can temporarily exclude profiles that are otherwise creditworthy.
- The broker optimises insurance and ancillary fees to keep the APRC below the threshold.
Frequently asked questions
How is the usury rate calculated and updated?
The Banque de France collects the average effective rates applied by lenders on a category of loan during the past quarter, then adds one third to obtain the usury rate for the following quarter. This mechanism creates a lag: when market rates rise quickly, the legal ceiling lags one quarter behind. In 2023, the Banque de France temporarily switched to monthly revisions to reduce this gap.
Why can a creditworthy borrower be rejected because of the usury rate?
The APRC includes not only interest but also borrower insurance, arrangement fees, and guarantee costs. An older borrower or one whose medical profile raises the insurance premium may end up with an APRC exceeding the legal ceiling, even if their nominal rate is standard. In this case, the broker can negotiate cheaper delegated insurance or ask the bank to reduce its fees.
What is the difference between the usury rate and the nominal rate?
The nominal rate is the raw interest rate applied to the capital, excluding ancillary costs. The usury rate applies to the APRC, a global indicator incorporating all mandatory credit costs. A loan with a reasonable nominal rate can still breach the usury threshold if insurance or fees are high.
In practice
On a €250,000 file, the nominal rate is acceptable but the insurance premium for a 58-year-old client pushes the APRC to 6.12% while the usury threshold is 6.00%: the broker negotiates delegated insurance that brings the APRC down to 5.85% and unlocks the financing.
Official sources
- Usury rate · Banque de France
- The credit usury rate · economie.gouv.fr
- The annual percentage rate (APRC) · Service-Public.gouv.fr