French Mortgages and Mortgage Advice

Mortgages

You can easily obtain a mortgage to purchase your property in France. If you are buying a home in France, there are three ways to raise the mortgage: against an existing UK property, providing there is sufficient equity; against the French property; or a mixture of both.

At first, there are certain things a potential buyer needs to know:

When you sign the reservation contract at the sales office, you must have already decided whether or not you are going to take out a mortgage because you will be asked by the sales person to write out a sentence on the contract in French, and sign to say if you do not have a mortgage.

You must have your mortgage arranged and agreed on before you sign your "Acte de Vente" (deed of Sale) at the Notary's, usually one to three months after you have signed your reservation contract, if you are taking one out.

Mortgage options

There are various options as to where to obtain your mortgage or funding to finance your new purchase.

Mortga ge through a French bank

There are considerations involved in borrowing money in another currency, which, if the exchange rates are unfavorable, can work out more expensive than originally planned. With the right advice, however, even the most inexperienced borrower can successfully buy their dream home.

French banks are very keen to lend money at very attractive rates and terms. Currently as a non-resident you can obtain a 20-year mortgage for 80% of the property value at between 3 - 4% (French resident is 100%, 80% for a European resident and 60-65% for a non-EU resident). Should you need more information we have good relationships with French banks that offer attractive interest rates.

French mortgages are not based on the UK model of income multiples. Typically the calculation works on the principle that the total of the French mortgage payment, plus any UK mortgage or rent, plus any other long-term borrowings, should not exceed a third of the buyer's gross monthly income. The actual process of applying for mortgages in France, again is not difficult, and usually takes at most 2 to 3 weeks but can be done even quicker. In summary, obtaining a mortgage for a French property is generally not difficult, especially with our help.

Mortgage broker

Some of our clients obtain a mortgage through a broker, who will sift the market place for the best deal, one that best suits your circumstances. We will be happy to recommend reputable brokers to you.

Re-mortgaging

It is common to re-mortgage in the UK to raise money for a variety of purposes. This is not so common with French lenders, although some are starting to offer mortgages on this basis, allowing the borrower to take advantage of rising values and equity. However, generally speaking, if you think you will need additional funds later, it is better to raise these at the time of purchase, when it may be easier to obtain the finance.

Leaseback property & guaranteed rental

Leaseback is a financial product and should be considered as part of a personal financial plan with or without the benefit of using the property yourself for a limited number of weeks per annum. It can be an attractive proposition as part of a longer term investment portfolio strategy. Property investment with guaranteed rental income is a much sought after type of investment. Properties with a guaranteed rental income provide both a benefit of long term appreciation as well as the safety of income. This type of investment is very popular in France due to the tax breaks available to buyers.

Opening a bank account in France

Opening a bank account in France is essential to pay the monthly installments on your mortgage. In order to open an account in France, you just have to bring a few documents (copy of your passport, proof of address and bank statements), fill out an account application form and the bank will send you your account details with a RIB (Releve d'Identite Bancaire or bank account identity slip). It is that simple!

Money Transfer

You can transfer your money with your current bank or through a Company specialising in Overseas Money Transfer.