GETTING A MORTGAGE FOR YOUR FRENCH PROPERTY

If your property in France requires a mortgage a little research can pay enormous dividends. By comparing interest rates, terms and fees in building societies and banks in both France and your home country you can often shave a few points from the quoted interest rates.

You can also decide between a euro or sterling mortgage. Remember though that interest rates in France are usually lower than the UK.

French Mortgages Explained

French mortgages, called hypothèques, are the repayment type (not endowment or pension-linked), and interest rates can be fixed or variable.

French banks are not allowed to offer mortgages or loans where repayments are more than 30% of your net income. When assessing a couple’s borrowing limit, joint incomes and liabilities are considered.

French mortgages are usually limited to 80% of a property’s value (50% with some lenders). The mortgage period is usually 15 years, but can be anything from two to 20 years. Life insurance is mandatory.

If you are raising the finance in your home country you may be able to re mortgage, or release the equity in your current property.

If you’re paying a large cash deposit, it may be more beneficial to take out a loan rather than a mortgage to cover the rest. There are also various French loan options for those resident in France.

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