Market Update from April 2023
A bit of sunshine on the French mortgage market coming your way!
We have a great news to share to our international investors who want to buy property in France.
One of our main lenders is coming back after a hiatus to finance existing and off-plan properties all over the country (no refinancing or post-financing mortgages available).
Cherry on the cake, they can finance UK residents and British expats (living in France, Germany, Netherlands & Switzerland) which is something that has become pretty rare post-Brexit. They can also finance residents from Germany, Netherlands & Switzerland.
To add to the cherry on the cake (it’s becoming quite a heavy French patisserie), our lender can finance our friends in the USA (US Residents but also US Citizens in the countries listed above).
Additionally, the life insurance that is typically tied to mortgages will be optional which means you will have a way to reduce your overall costs. However, we always advise our clients to have some kind of cover – either in their country of residence or in France.
We are be able to offer up to 85% LTV for repayment mortgages, with a fixed rate up to 25 years.
A mixed mortgage option is available as well for 75% LTV, with a fixed rate over 25 years. The mortgage start with an interest only loan for up to 7 years and is then followed by a repayment loan for up to 18 years. The affordability is based on the repayment mortgage over 18 years.
The rates are increasing still and so is the taux d’usure, though it still provides a challenge to the French banks to find profitability as the refinancing rate is still above or around 3% (the banks usually use the SWAP 7). This is the reason why our newest lending addition require a company set up: it avoids the limitation of the taux d’usure as the loan is now provided to a commercial entity rather than an individual.
French mortgage rates are now around 4% fixed for 20 years if you buy under your personal name or around 5% fixed for 25 years if you buy with a French limited company.