Buy-to-let investment · Guide
SCPI financing: what the lender checks before funding units
Few lenders finance SCPI units. Loan regime, income considered, security, fees, liquidity: what they verify and how to prepare.
Financing SCPI units on credit remains possible, but with few lenders. Expected distributions are often excluded from the debt-to-income ratio calculation, whereas the instalment counts from the outset. Without a property to mortgage, the security rests on the units and, frequently, on a personal guarantee. Subscription fees and the enjoyment period may delay the first income, but not the first instalment.
By Sandy MASCART, mandataire d'intermédiaire en opérations de banque et en services de paiement ORIAS 26000541 sous le mandat de CDV PATRIMOINE & ASSURANCE (ORIAS 14005573)
Key points
- The name of the product does not determine the loan regime: the Consumer Code itself defines the scope of each of its two chapters.
- A future distribution does not rely on any verifiable document concerning you: often, it is not taken into account, whereas the instalment counts from the outset.
- Without a property to mortgage, the security most often rests on the units themselves and, frequently, on a personal guarantee.
- Subscription fees and the enjoyment period, if any, shift the timing of when the operation yields returns; the first instalment, however, follows the credit agreement.
- To whom, within what timeframe and at what price the units can be transferred: these are questions to ask before subscribing.
SCPI shares can be financed on credit, with few lenders: expected income is often ruled out, security over the shares, months without income. Come with a file that already answers these three objections. The full journey: investment property.
Why do so few banks finance the purchase of SCPI shares?
No property to visit, no deed at a notary, no dwelling to mortgage: the file is processed manually. A refusal does not judge your solvency.
The management company can open the door
If it belongs to the bank's group, the financing is often a standard product. The possible lenders depend on the SCPI in question: changing the SCPI can reopen doors.
Does this loan fall under mortgage credit or consumer credit?
The name of the product decides nothing. Ask the lender, in writing, under which chapter the loan offer falls: your protections depend on it.
The mortgage credit chapter covers, in particular, the purchase of shares "entitling the holder to ownership" and credits secured by a security over a dwelling. Consumer credit adds an amount criterion.
Le seuil délimite un champ d'application, il ne qualifie aucune opération en particulier. Au-delà, ce chapitre cesse de s'appliquer ; le seuil ne dit pas quel régime prend le relais.
- En vigueur depuis le
- Source
- Article L. 312-1 du code de la consommation — Légifrance
- Délai de réflexion de l'emprunteur 10 jours
- Maintien minimal des conditions de l'offre 30 jours
Ce délai et ce maintien sont attachés au chapitre du crédit immobilier. Un contrat qui n'en relève pas obéit à d'autres règles de formation.
- En vigueur depuis le
- Source
- Article L. 313-34 du code de la consommation — Légifrance
Before signing the statement, ask: what happens if the loan is refused, and where is this written?
Share income: often excluded from the debt-to-income ratio calculation
Rarely in full, and often not at all until you hold the shares. A future distribution is not verifiable income.
The instalment is included in the outgoings from the outset; the expected income is included at a discount, or not at all. If the contract falls under Article L. 313-1 of the Consumer Code, the debt-to-income ratio is capped.
La norme vise les contrats de crédit mentionnés à l'article L. 313-1 du code de la consommation, s'ajoute aux critères propres du prêteur et laisse aux établissements une marge de dérogation, dont la plus grande part est réservée aux acquéreurs de leur résidence principale.
- En vigueur depuis le
- Source
- Décision D-HCSF-2021-7, art. 1er — Légifrance
- No shares yet: rely on your other income.
- Shares held for several accounting periods: your distribution statements change the conversation.
- Direct property holdings: see the debt-to-income ratio calculation for investors and The fourth property wall.
A guarantee on the shares, and often on you
A guarantee on the shares, whose value fluctuates, and often a personal guarantee.
If a civil company takes out the loan, the lender often requires a guarantee from the partners. The amount written in your own hand in the clause, not the price of the shares, limits your liability.
Fees and enjoyment period: when do your SCPI shares start generating income?
Not necessarily in the first month: the company’s documents state this. The loan instalment, however, follows the credit agreement.
- The subscription fee: paid immediately, recovered over time.
- The enjoyment period: you pay the instalment without any income.
- The rhythm: a quarterly flow against a monthly debit.
Quantify this phase and show how you absorb it.
Selling shares: plan a genuine fallback
Ask about the exit conditions (to whom, in how much time, at what price) before subscribing.
Selling becomes difficult when everyone is selling. The real fallback: savings that cover the instalments.
The decisive test: a falling distribution, an instalment that remains
The distribution may fall. The instalment remains due.
Does the file hold up if the distribution is zero for several quarters? If not, it is a gamble, and the committee will see it. The same confusion applies to furnished rentals: Investing in LMNP: does the bank finance a furnished property like a bare rental?.
The documents that make the difference to the lender
Your usual documents, plus the company’s documents, your distribution statements and the table showing the gap between the instalment date and the first receipt.
Personal documents: financing a buy-to-let investment. Add:
- The articles of association, the information note and the latest annual report.
- The distribution statements for the units already held.
- The table of the two calendars, month by month.
- Proof of the remaining savings, which replaces the missing guarantee.
The taxation of the units is to be settled with a chartered accountant. A consumer credit offer: see whom to approach.
SCPI chosen? Create your file or verify by telephone which lenders process these units.
Sources
- Légifrance — Article L. 313-1 du code de la consommation
- Article L. 312-1 du code de la consommation — Légifrance
- Légifrance — Article L. 313-16 du code de la consommation
- Légifrance — Article L. 313-11 du code de la consommation
- Légifrance — Article L. 313-12 du code de la consommation
- Article L. 313-34 du code de la consommation — Légifrance
- Article L. 313-41 du code de la consommation — Légifrance
- Légifrance — Article 2297 du code civil
- Légifrance — Article L. 311-1 du code de la consommation
- Article L. 312-1 du code de la consommation — Légifrance
- Article L. 519-6 du code monétaire et financier — Légifrance
- Décision D-HCSF-2021-7 — Légifrance
Read next
- How much can I borrow? Mortgage capacity in Lyon
- Financing a bare ownership purchase: the loan for a property that generates no income Bare ownership on credit: no rental income against the loan. Term aligned with the usufruct, security, charges, taxation, exit: what the bank checks.
- Rental income: how the bank calculates your debt-to-income ratio as an investor Weighting of rents, classical or differential method, disposable income: why two banks calculate an investor's capacity differently.
- Investing in LMNP: financing a furnished property, and what the bank actually considers LMNP financing: the same loan as unfurnished letting, but furniture is excluded from the loan, rents must be proven, and the tax return is scrutinised.
- Financing a fourth rental investment: why the bank stops, and how to proceed Refusal at the third or fourth rental investment: what is truly blocking the bank, and the levers that restart the financing, in the right order.
All articles on this topic: Buy-to-let investment