Buying in: Grimaud, South of France.
Property price: €775,000
Mortgage amount: €504,000
Mortgage type: Repayment
Mortgage term: 20 years
Interest rate: 2.00% Fixed
Despite having a very strong income and the required deposit, it was difficult to find a lender to finance the project of our client. Born in north Africa and now residing in Dubai, most of our banking partners would not consider his application for compliance reasons. Since the villa was off-plan, it also added an element of risk for lenders.
We came back to him with a solution thanks to our relationships in Monaco. Although this was a viable option, it was not the loan structure the borrower had in mind going into the purchase. The private bank proposed a 100% LTV repayment mortgage with 30% AUM. The client went on to explore the options by himself. Out of luck, he came back to us after a few months and we applied with the private bank.
The committee agreed to lend with the condition that the collateral would be increased to 40%. While this was feasible, it was quite costly for our client to do so as he would have had to draw the additional funds from his investments thereby generating a penalty for early exit.
At that point, we went back to the regional retail lenders we contacted. We emphasised again that the borrower was working for one of the largest multinationals in the world and only had employment income. One bank agreed to take a second look providing that we send them 3 years of payslips and bank statements.
This was a very long process with numerous questions to answer and documents to provide, but with tremendous cooperation and patience from the client, in the end FPF came through and delivered with a loan offer close to his original expectations, without any AUM.