Finance Property Buying Guides

French Mortgages

France has one of the most attractive mortgages available for foreign clients, giving them peace of mind for their long-term Real Estate Investment in France.

1. Low-Interest rates from 2.5o % fixed for 20 years
2. You can offset all your Property Costs to have zero Income tax liability
3. Loan to Value can be between 70% Mortgages. 

Clients tend to hold onto their French Properties for 20 years for their pensions with low-interest rates fixed for 20 years. The VAT of 20% that can be claimed back on new build properties can also help to finance a purchase of the property.

How do I get a French Mortgage?

Before placing your deposit to secure your property it’s best to understand exactly how much you can borrow from the French Banks and to have a decision in principle.  We can recommend a French Brokers who speaks fluent English and has a variety of different banks in France to choose from depending on your criteria so you can choose the right property. 

One of the important factors is your debt ratio that the bank will take into consideration in your mortgage application. Your monthly repayments for loans etc cannot exceed one-third of your gross monthly income.

Cost per month per 100k borrowed

10 years repayment can cost 925 per month
15 years repayment can cost 650 per month
20 years repayment can cost 500 per month
25 years repayment can cost 450 per month
An interest-only mortgage can cost 200 per month

French Mortgages Available 

1. Repayment Mortgages in France: You pay the capital and interest on the repayments. This is the most common package in France that offers the most security against your property

2. Interest-Only Mortgages in France: You only pay the interest on the amount you borrow after the duration of the mortgage if you still owe the money you must sell the property to repay the money borrowed. 

3. Fixed Rate Mortgages in France: There are some great Fixed rates available over, 10,15,20, 25 years for the entire duration of the mortgage. Which gives you total peace of mind about where you are with your investment.
4. Variable Rate Mortgages in France: These are normally capped and can be up to five years if the rates increase so does the repayment on your mortgages, if the rates decrease your mortgage repayments decrease.

Purchasing your French Property through a company

This is advisable for purchases above €1.2m to be more tax optimized, once the company is formed you must provide all the details of the company to your mortgage adviser and bank. We can also introduce you to the right Notary practice that specialises in company structures. 

Mortgage-related fees

Mortgage Registration tax; this is normally charged at 1.5% for a new build property, and 0.75% for resales. 

French Banks & Broker fees can charge up to 1% to arrange the mortgage

Benefits of taking out a French Loan

1. Interest rates are lowered and fixed for the duration of the mortgage
2. Interest on a French Mortgage is tax deductible
3. Low Cost

There are just 6 steps to take out a French Mortgage

1. Establish your affordability with a broker and secure your property with your 5% Deposit
2. Submit your mortgage application with your paperwork
3. Receive your mortgage approval 
4. Open up your French Bank Account & have your life Insurance in Place
5. Your French Mortgage offer will be in place which you need to complete, sign and wait for the 10-day cooling-off period starts
6. We liaise with the developer, Bank, and French Notary to Complete your Purchase

What documents are Required to Apply for a French Mortgage?

• Proof of Home Address
• Passport copies
• Marriage Certificate
• Application form for the Mortgage
• Last 3 months’ payslips
• Tax Returns
• Proof of Additional income such as pensions, dividends, and rental income