In this article
A mortgage offer deserves careful reading before you accept it. The reflection period gives you an opportunity to check that the proposed financing matches your plans and that its conditions are understandable. You can also choose to decline the offer.
When looking into “loan offer reflection period”, start by noting the date of receipt, then examine the amount borrowed, repayments, cost of credit and associated conditions. This guide provides general information: if you have a question about your application, ask for an explanation tailored to your circumstances.
Identifying the period before acceptance
Before accepting a mortgage offer, you must observe a minimum reflection period of 10 calendar days. This period begins on the day after you receive the offer. You may return the offer to the lender by dated and signed letter from the 11th day.
For example, an offer received on 1 February can be accepted from 12 February. To prepare your own timetable, note the date of receipt, identify the following day as the start of the period, then identify the first day on which you can return the offer.
Another method besides postal mail may be used to establish the date of acceptance with certainty, such as an email. Check with the lender which arrangements apply to your application before proceeding.
The bank must maintain the conditions of its offer for a minimum of 30 calendar days from receipt. Note this period separately from the reflection period: the former concerns maintaining the conditions, while the latter precedes acceptance.
Gathering the offer and the FISE
If the bank accepts your application, it must send a loan offer free of charge to you and to any guarantor you may have. The offer must be accompanied by the European Standardised Information Sheet, or FISE. This sets out, among other things, the main features of the proposed loan, its repayment arrangements and its interest rate.
Keep these documents in front of you as you read. Start by checking the identities, nature and purpose of the loan, then note the expected date when the funds will be available. If anything seems different from your plans or difficult to understand, ask for clarification before deciding.
The FISE makes it easier to compare offers from different banks. To make use of it, place the documents side by side and note the features you want to examine: amount, repayment, rate and associated conditions. A comparison is more useful when you understand what each proposal covers.
Checking the amount and term
Compare the loan amount stated in the offer with your financing plan. To determine the total cost of the property transaction, you must take into account, among other things, the price of the property or the cost of construction, the cost of the guarantee, notary fees and loan application fees.
Also review how your personal contribution fits into your plan. You can use all or part of your savings to finance part of your property project. Ask the bank to explain any discrepancy you notice between this plan and the amount offered.
Next, examine the chosen term and the planned monthly payments. The term of a mortgage varies and is generally negotiable with the banker. Check that the schedule presented matches what you had envisaged, and ask for an explanation if you find the repayment schedule difficult to assess.
For a fixed-rate loan, the offer includes a schedule detailing, for each monthly payment, the portion allocated to repayment of the principal and the portion allocated to interest. Take time to read this table: it lets you distinguish these components over the course of repayment.
Understanding the rate and cost of credit
The rate may be fixed or adjustable. A fixed rate remains unchanged for the term of the loan, unless it is renegotiated or the loan is refinanced during repayment. An adjustable rate varies in line with a reference rate.
For a variable-rate or adjustable-rate loan, the offer includes a notice setting out the conditions and arrangements for changes to the rate. It also includes an illustrative document simulating the impact of a change on the monthly payments, the loan term and the total cost of credit. Read the notice alongside this simulation and ask for explanations of what the changes shown would mean for your budget.
To compare several offers, look at the annual percentage rate of charge, or TAEG, rather than the interest rate alone. The TAEG allows you to compare their total cost provided that the amount borrowed is the same. It takes into account, among other things, application fees, the cost of borrower insurance and the cost of guarantees.
If your project involves buying a property off-plan, interim interest is not included in the calculation of the TAEG. Be sure to ask the lender about this interest and the release schedule applicable to your transaction.
Reviewing guarantees and insurance
The bank may require a guarantee to ensure that the monthly payments are made if you have difficulty paying them. It may require a bank guarantee, a conventional mortgage or a special statutory lender’s mortgage. Identify the guarantee required in the offer and its cost in your financing plan.
The bank may also require borrower insurance and specify the risks it must cover. However, it cannot impose the choice of insurer on you. If the bank offers insurance, it must attach a notice setting out its features.
Review the covered risks and the price presented in the insurance documents. If you are considering another insurer, check the conditions set by the bank. Also ask for an explanation of any term or condition you do not understand before choosing.
Preparing your decision and the next steps for your project
Before returning the offer, gather your questions: does the amount match the financing sought? Are the term and monthly payments what you had envisaged? Do you understand the TAEG, the guarantee, the insurance and the date when the funds will be available? Ask for answers on points that remain uncertain, then keep your documents so you can review them together.
Until the offer is accepted, the buyer must not receive any payment from the bank. When the transaction involves a notary, the funds are generally released on the day the deed is signed before the notary. For construction work, the bank releases the funds in one or more instalments according to the schedule set out in the offer.
Finally, make an informed choice: you can accept the offer after the applicable period or decline it. If you would like support with the process, you can contact, among others, a departmental housing information agency, or Adil.