• Buying in: Courchevel (Sundance Lodge), French Alps
• Property price: €1,530,000
• Loan amount: €1,071,000
• Mortgage type: Repayment*
• Interest rate: 2.70%*
• LTV: 70%
• Term: 20 years

The background

In the current market, with the rates rising, one issue we meet is that the banks cannot finance a client because the T.A.E.G (French APRC equivalent) cannot go over the ‘’taux d’usure’’ which is the maximum rate a bank can charge a client (all included) for his/her mortgage. 

So either the bank reduces its rate to finance our client but the bank is making a loss over 20 years or they just don’t finance him/her.

Our Approach

Therefore, to avoid having to refuse our client, the bank requested that the purchase was made with a French limited company (SARL de Famille). As the SARL de Famille is commercial entity, the ‘’taux d’usure’’ rule does not apply which meant that the bank could finance our client without making a loss on the transaction by having a slightly higher rate than they would charge should they have to respect the ‘’taux d’usure’’.

It sounds complicated but it is not: it is down to whether it is profitable or not for the bank.

* The rate / the product may differ to what is currently offered since this mortgage has been agreed.