What salary to borrow 150,000 euros in mortgage loan?

150,000 euros is the amount of a small new house in the countryside with two bedrooms, or the price of a major renovation to restore old property.

In other words, it is a mortgage amount that banks are used to. A classic loan file that can currently get the majority of borrowers, including those receiving the minimum wage.

A mortgage of 150,000 euros, for which monthly payments?

Before you even ask yourself what salary is needed to borrow 150,000 euros, knowing the monthly payments you will have to pay is an excellent basis. Indeed, if you can pay rent for the same amount and already do so, there is a good chance that you will be able to acquire your main residence thanks to the mortgage.

Currently, property prices are most often granted over a period of 15 to 30 years, depending on the monthly payments you can pay without getting into debt. The longer the loan, the lower the maturities, but it will cost you more in the long run.

Let’s see some examples for a mortgage taken out in December 2020 at the average loan rate observed:

  • Over 15 years: monthly payments of 930 euros per month for a total cost of credit of 17,469 euros, insurance included
  • Over 20 years: monthly payments of 739 euros per month for a total cost of credit of 27,373 euros, insurance included
  • Over 30 years: monthly payments of 608 euros per month for a total cost of credit of 68,969 euros, insurance included

In other words, you can borrow 150,000 euros for just over 600 euros per month, without even having negotiated if you have a good record.

A bank loan of 150,000 euros, for what debt ratio?

Now that you have an idea of ​​the possible monthly payments for a bank loan of 150,000 euros, it is necessary to calculate your debt ratio to know if it is possible for you to obtain a loan without difficulty.

Be careful, your debt ratio will be more important than your salary in the eyes of the bank. Indeed, it takes into account all of your income, but also all of your expenses.

In a weakened economic context and with relatively low borrowing rates, it is to have a debt ratio of 33% maximum. Otherwise, you will need to have a solid case and provide financial guarantees to your banker, unless you have a very high income.

The debt ratio is calculated as follows:

[ Échéance(s) de(s) prêt(s) / revenus du foyer ] x 100 = debt ratio

It is therefore necessary to take into account the total amount of your loans.

Example for a couple with 3,000 euros of income per month

Take the example of Pierre and Sophie, both have a net salary of 1,500 euros per month. But they also have a loan for their car with monthly payments of 250 euros per month.

They have just found a small house with a garden 15 kilometers from the city center, with a room for their future child, that’s perfect!

If they borrow 150,000 euros over 20 years, they will have mortgage maturities of 739 euros. In all, the amount of their credits is 989 euros (739 + 250).

(989/3000) x 100 = 33%

Pierre and Sophie therefore have a debt ratio of 33%, which perfectly matches the requirements set by the bank. Their salaries of 3000 euros are sufficient, despite their car loan: this is good news for them!

Example for a single person with 2,000 euros of income per month

We find Géraldine, a young single woman employed in a startup as a marketing assistant for three years. She receives a net salary of 2,000 euros per month.

She spotted a cozy apartment not far from her work, on the outskirts of Nantes, at 150,000 euros, she would like to have her “home”.

She has no outstanding loans and takes public transport. By moving and becoming an owner, she could go to work on foot, this idea delighted her!

She can therefore afford monthly loan payments of up to 660 euros (2000 x 33%).

This is excellent news for her, who can borrow 150,000 euros over 30 years with a debt ratio of less than 33%. A wise way to diversify your heritage!

Conclusion: whatever the salary, as long as you have the right debt ratio

Through the example of future parents Pierre and Sophie, and that of the young working girl represented by Geraldine, you have seen that salary is not the real question to ask yourself in order to obtain a mortgage of 150,000. euros.

In the end, it is the debt ratio that will be retained in your favor or against you. And to vary it upwards as well as downwards, the duration of the mortgage is very important.

As much as possible, think about your living quarters, it should be enough for you to treat yourself to a few small pleasures, like going on vacation or buying yourself a state-of-the-art flat screen. And try to reduce the loan term by a few years, the borrowing rate and the overall cost of credit will be more favorable.

A mortgage of 150,000 euros remains a solid investment, a safe bet to prepare for your future. To be a winner, do not hesitate to perform an online simulation to access the best mortgage offers on the market!

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