AAH plus pension: what French lenders will actually accept

A retiree who receives the AAH (allocation aux adultes handicapés, France's disability allowance for adults) can borrow, but only if the allowance continues past retirement age. It does when the assessed incapacity rate is at least 80%: the AAH then becomes a top-up (AAH différentielle) that brings the pension up to €1,041.59 a month, the maximum amount in force since 1 April 2026. A lender simply adds the two together.

With an incapacity rate between 50% and 79%, the AAH stops at the legal retirement age and is replaced by the pension, or by the ASPA (the minimum old-age pension) if you never paid contributions. Knowing which category you fall into is therefore essential before applying, because the banker will check the CAF or MSA payment notice and the decision of the MDPH (maison départementale des personnes handicapées, the local disability office). English-speaking residents who were assessed in France after moving here are covered by the same rules; any pension or benefit paid from the UK or another country counts among your resources.

Working out income: the AAH top-up plus the pension

The mechanism is straightforward: you receive the difference between the maximum AAH and your pension. A pension of €650 entitles you to about €391.59 of AAH, making €1,041.59 in total. If the pension rises, the AAH falls by the same amount, so overall income stays steady, which credit analysts like even though the sum is modest.

Since 1 October 2023 the AAH has been calculated without reference to a spouse's income (déconjugalisation). For a couple, this means the allowance is kept even if the husband or wife has a good pension. A lender, however, looks at all household resources when both partners borrow together.

Example: a 66-year-old with an 80% incapacity rate

Monica, 66, receives a €650 pension and €391.59 of top-up AAH, €1,041.59 in all. Her social housing rent of €380 is partly covered by the APL (housing benefit). She needs €2,000 for a riser recliner chair and a care bed that are not reimbursed. A microcredit over 30 months at an assumed 4% comes to about €70 a month.

That instalment is under 7% of her income, and what remains after net rent and the loan exceeds €700. The charity that prepares her file confirms she can afford it. A €10,000 loan over seven years, by contrast, would have been declined everywhere for lack of margin.

Borrower insurance: the crux of the file

Most insurers treat a disability as an aggravated health risk (risque aggravé de santé). They may add a loading, exclude some guarantees or decline altogether. For a mortgage or business loan, the AERAS convention (the French framework for insuring people with a serious health condition) requires a three-level review, up to a pool of reinsurers, provided the insured amount does not exceed €420,000 and the cover ends before age 71.

For consumer credit tied to a purchase, AERAS exempts only borrowers under 50 from the health questionnaire, so a retiree must complete it. The good news is that insurance on a personal loan is not legally compulsory, and many lenders require it only above a certain amount.

The premium cap for lower incomes

Under AERAS, for borrowers on modest incomes, the insurance loading may not raise the TAEG (the French APR) by more than 1.4 percentage points on certain home and business loans. Banks and insurers absorb the excess. Ask explicitly for this mechanism, known as écrêtement, because it is not always offered automatically.

Which product for which amount?

For a home purchase, AAH plus pension rarely supports more than around a hundred thousand euros unless you have a large deposit or a co-borrower. Retirees looking to leave unsuitable housing more often turn to renting an accessible home or to social home ownership schemes, and keep credit for furniture and equipment.

The procedure we recommend

1. Gather the MDPH decision stating your incapacity rate and the current AAH notice.
2. Add your latest pension statement and tax notice (avis d'imposition).
3. Estimate what you have left to live on after rent net of APL, energy, mutuelle (health top-up insurance) and unreimbursed medical costs.
4. For a small sum, contact a microcredit charity or your CCAS (municipal social services) first.
5. For a larger amount, have a broker specialising in aggravated risks obtain insurance quotes.
6. Send medical documents directly to the insurer's medical officer in a confidential envelope.

Why files are refused, and how to respond

The most common refusal stems from confusion about whether the AAH continues: some advisers believe it always stops at retirement. Attach the notice showing the 80% rate to clear up any doubt. The second reason is too little left to live on: reduce the amount or lengthen the term slightly.

A third reason is the PCH (prestation de compensation du handicap) or the independent living supplement being wrongly counted as income. These sums cover specific needs and are generally not taken into account. Finally, a refused insurance application sometimes blocks everything: offer a guarantee from a relative or a pledge of a small assurance-vie, or ask for the second-level AERAS review.

Alternative guarantees under AERAS

If no insurance is granted, the bank must consider a substitute guarantee: a solvent person acting as guarantor, a pledge of investments, the assignment of an existing protection policy, or a mortgage charge on another property. These options are set out in the convention and can rescue a modest property project.

Other resources to tap before borrowing

The départements' disability compensation funds (fonds départementaux de compensation du handicap) can cover part of the remaining cost of an assistive device once the PCH has paid its share. The Complémentaire santé solidaire (the means-tested health top-up) cuts medical costs, and some pension funds grant one-off help. Every euro obtained this way is a euro you will not have to repay.

For adapting your home, MaPrimeAdapt' is open to AAH recipients at any age and covers 50% to 70% of the work depending on income. Credit then only covers the balance, for an amount and term compatible with a tight budget.

Frequently asked questions

Do all banks accept the AAH as income? Most regard it as stable income, especially when it is awarded with no time limit. A few remain reluctant, and a broker knows which ones accept it.

Will my AAH drop if I take out a loan? No. A loan is not income and does not change the allowance calculation. Putting the borrowed money in a savings account would, however, generate interest that has to be declared.

Can I still use AERAS at 68? Yes for a mortgage, as long as the insurance ends before your 71st birthday. In that case the term is under three years, which sharply limits how much you can finance.

Is microcredit possible if I am also on the FICP? Some networks accept it after review, but the file must show the new loan will not worsen your situation. Dealing with the incident behind the listing on the FICP (the Banque de France register of repayment incidents) remains the priority.

Is a foreign pension counted when the AAH top-up is calculated? Yes. Pensions from the UK, Ireland or elsewhere count as resources and reduce the AAH top-up, just as a French pension does, so declare them accurately.