Buying in: Courchevel, French Alps.
Property price: €1,002,500
Mortgage amount: €701,750
Mortgage type: Repayment
Mortgage term: 20 years
Interest rate: 1.65% Fixed
When running a ltd company, French banks will look at your salary & dividends for the past 3 years to assess affordability. This can prove difficult for business owners who tend to pay themselves just what they need.
The client had an existing mortgage in the UK which was hurting his affordability based on the French calculations. A debt ratio of 33% is the benchmark for retail lenders in France. However, we work with a couple of lenders that can go up to a 40% debt to income ratio as well as private banks which can be more flexible given the assets pledged with them.
The client was reluctant to pledge any money into the bank as he wanted some flexibility.
We contacted our partners offering the highest allowance on the debt ratio (40%) with a long term mortgage to reduce the monthly cost as much as possible to fit it within the debt ratio limit.