Which French Mortgage?

Summary: Guide to French mortgages, which lenders offer which product and how to get international mortgages to buy property in France

It’s a well known fact that France is one of the most popular European nations in which those seeking a home overseas, a holiday home in the sun or a profitable investment property opportunity look for real estate; therefore it’s unsurprising that there’s a lot of activity in both the local French mortgage market and also the overseas and expatriate mortgage markets for properties in France.

This is the Shelteroffshore guide to mortgages in France to help you answer the question ‘which French mortgage is right for me?’

In France the currency is the euro and the vast majority of properties are marketed for sale in euros – therefore whichever country you herald from and whichever currency your nation uses it makes a lot of sense to consider taking out a mortgage in euros when buying in euros…

Why? 

Because euro mortgage rates are often lower than sterling mortgage rates for example, because a euro mortgage taken out on the French property being considered will mean that any other residences the buyer owns will not necessarily need to be secured against the mortgage and because it makes it easier for the buyer to see the value of his property rise in relation to the amount of mortgage he has left to pay!

Other options do exist of course – such as re-mortgaging a principal residence and using the released equity to buy property in France for cash or raising a personal loan to buy in France.  Both of these options can be considered – and remember that ultimately a personal choice will be dictated by personal circumstances which is why it is essential to take advice from a mortgage lender, broker or financial adviser before committing to any form of mortgage or finance plan…this article is just a guide to what’s available.

Some of the best established international banks have a presence in France – these mature institutions such as Barclays Bank or Abbey International offer a variety of mortgages with repayment periods of between 5 and 25 years and Barclays Bank in particular is one of the better lenders because they will consider mortgages for purchase, renovation and construction of properties in France, they will lend on off plan properties and they will lend on French leaseback property and they don’t even mind if the home is not going to be used as a primary residence making them especially flexible which is why we have recommended them to a number of our readers who have directly requested further expert information about French mortgages.  Click here to go to their contact form and ask questions of them about your own mortgage needs and they’ll call you right back.

All lenders offering mortgages in France have to of course abide by French law - and under French law the lender must ensure that the borrower can actually comfortably afford anything they borrow.  This means that for your own calculations you should not look to be paying out more than a third of your gross annual salary on worldwide mortgages, loans and other debt payments such as credit cards etc. 

In terms of typical amounts offered by lenders supplying French mortgages – you can usually get about 80% of the property price or valuation financed (70% if the property comes under the leaseback scheme) – but remember, the best lenders will consider all circumstances and advise you personally about the options you have and help you to decide which French mortgage will best suit your requirements.

Finally, if you’re seriously considering buying property in France and you think or know that you will require a mortgage you should consider speaking to a lender before making any firm commitment to buy so that you are armed with facts about how much you can borrow, how much a mortgage will cost you each month, how much the mortgage arrangement fees will be and how long it will take to raise the finance once an offer has been accepted to buy…forearmed with all this information a buyer can be far more confident when they begin their search for that ideal French home.

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