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Mortgage Criteria |
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French Mortgage Connection are pleased to confirm
the following general lending criteria for French mortgage business,
where the buyer is purchasing a "residential property" (with no major
commercial element) for use as a holiday / second home or for their
own main residence.
Please note that we do not arrange
mortgages for Gites, or other commercial premises, where the income
from such businesses is required to be taken into account to support
the proposed mortgage borrowing. |
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| Maximum Percentage Mortgage
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UK
Nationals & other EU Nationals - living anywhere
"outside" of France itself - up to
85% including estate agents' fees as a maximum
Non EU Nationals
- up to 80% of the net price plus up to 80% of an estate
agents' fees (excluding Notaries' fees) maximum.
For clients, of any nationality,
already resident, working & taxed in France
itself - and who are buying their main home, higher
mortgage percentage loans may be possible (i.e. 95% or even
up to 100% in some cases).
All ratios mentioned
exclude Notaries fees, which must be financed by
the client. |
| Currency
Denomination |
Currently in the Euro currency only, unless
borrowing over 1m euros |
| Minimum
Loan Amounts |
Our minimum
loan size is currently € 80,000 euros. |
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Term of Mortgage |
Minimum of 5 years & Maximum of 25 years (but
more commonly 20 years maximum with most lenders). For
employed applicants, not normally beyond state retirement
age unless there is adequate verified pension
or investment income in retirement. Clients who are already
retired may be able to secure a mortgage on the basis of
pension income - terms assessed on an ad hoc basis, but
cases below € 80,000 euros are not normally considered.
For Self employed clients - maximum term of 20 / 25 years
- provided this is not beyond age 70, (unless there is verified
private pension income available, post retirement).
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| Mortgage
Repayment Methods &
"Interest
Only" borrowing |
Repayment
("Capital & Interest") Mortgages - up to 85% of
the net purchase price (or 80% of the net price plus 80%
of any estate agents fees, if higher) for Non Resident clients,
or up to 95% for clients already working and taxed in France
at the time of the application
"Interest Only"
- up to 80% loan to value for cases of € 100,000 euros
or mote on full interest only basis, or a maximum of 80%
for cases below this borrowing level, with Interest only
for an initial period (maximum of up to 10 years) with full
repayment over a maximum of 15 years thereafter, for any
funds remaining outstanding after the initial Interest Only
period (full details on request).
Certain conditions / requirements
apply to full interest only type borrowing - full details
upon request. |
| Life
Assurance requirements |
Mandatory -
Life cover for the full amount of the loan (plus an allowance
for exchange rate movements / term alteration on a non euro
policy) is required as a condition of mortgage on the client(s)who's
income the mortgage "depends" upon at outset.
This is by Law in France. |
How
much can I borrow ? |
For full details on how this is
assessed, please refer to our FAQs section -
FAQ No. 1. "How much can I borrow" ? For a free assessment of your
borrowing capacity, please complete our Decision in Principle
form. |
Lending
Areas |
France & Corisca |
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Lenders' Arrangement Fee
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Varies according to the lender / scheme. Not payable
until the mortgage offer is "accepted" by you
OR "with the first mortgage payment" in most cases.
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Rate Options |
Variable, Fixed and Capped rates available
Please note: for variable rates mortgages the convention
in France is not to alter the monthly mortgage payments
where possible but to reflect changes in rates by altering
(i.e. extending or shortening) the mortgage term itself.
(certain limits apply, as this is not an open ended situation
of course) |
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Remortgages
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Yes - straight
debt refinance i.e.. "existing mortgage for new remortgage" or for
Renovation works. Up to 80% of the property value
(and up to 100% of the cost of the works) - subject
to valuation / project appraisal. |
"Leaseback" / Residence
du tourisme scheme properties |
Leaseback
scheme / arrangements, involving the granting of
long leases (often 9 /10 years plus) to a Developer (for
the purposes of reclaiming French TVA etc) are normally
acceptable to our panel lenders provided
(1) the mortgage is not to exceed 80% of the "TTC price"
(the price including the French TVA) and (2) the developer
is "well known" and able to offer fulfillment
guaranties (please see the FAQs section
on leasebacks for more information). Such cases are accepted
on an ad hoc basis, and we therefore suggest you contact
us to discuss the feasibility before signing any
contracts to purchase. Also you should ensure you have a
clause suspensive detailing the mortgage needed in any reservation
contract, unless you have recourse to full funds to complete.
For cases where the development is not completed, stage
payments can be arranged to suit the terms of reservation
contracts, subject to acceptance by the lenders concerned.
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"Equity
Release" mortgages |
Yes - up to 70% maximum.
Minimum € 80,000 euros, minimum property value €
115,000 euros |
New Property Construction |
Yes - with "Stage" payments
as and when required. Full details available on request. |
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