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Buying a home in France

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French mortgages and how they work

All mortgages are full status and proof of income and outgoings will be required. French mortgages can be arranged for acquisition, renovation ansconstruction. Re-mortgages and Equity loans are also available through specialist lenders.

A deposit of 20% of the purchase price is required and you will also be liable for solicitor's fees. Euro or Stirling mortgages are available, and the minimum loan amount you can borrow depends on the lender you use. Mortgages are generally Repayment loans and can be taken over a 5-25 year term, although some mortgage lenders will be happy to provide Interest Only loans. All mortgages should be fully repaid by the age of 70 and life cover is required. The mortgage is secured on the property in France.

The mortgage is secured on the property and the mortgage funds will be released by the lender to your notaire for completion.

French lenders assess eligibility for a loan on the applicant's ability to service the loan and not potential rental income from the property. The general guideline is as follows: of an applicant's net income 33% should cover existing outgoings and the monthly repayment on the French franc loan. If you are self-employed income is assessed as the average of the last three years' net income. A percentage of rental and investment income will also be considered. If employed a lender will base your income on your payslips and the amount that is credited to your account monthly. Outgoings considered are liabilities such as mortgage/rent in the UK, personal loans and maintenance commitment.

For example - if you have a net monthly income of £2000 with a UK mortgage of £500 and no other outgoings. Taking into account 33% of the income, that is £660, a borrowing with a monthly repayment of £160 could be considered.

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