French Mortgages

An initial issue which many potential purchasers of French property will consider is whether it is desirable to obtain a loan and if so whether this loan should be secured upon the French property or equity release from their English property.

Some people prefer to obtain mortgages in the UK property and security for their French purchase. This may suit some people particularly if they are paid in Sterling and do not receive any income in euros.

Taking a French mortgage  

Taking up a French mortgage secured upon your French property is likely to suit you in the following circumstances :

• Your UK property is mortgage free or almost mortgage free and you do not wish to put your UK property at risk.
• You are renting out your French property and receiving an income in euros.
• This means you will be paying most of your French mortgage in euros as well and you will thus be less exposed if the euro rises against the Pound Sterling.
• You believe the euro will not rise significantly and you are attracted by the very low interest rates being offered by French lenders at present.
• You like the idea of being able to fix your interest rate for up to 20 years

The downside of French mortgages is that the lending criteria and the documentation can both be quite off-putting and the arrangements fees can be quite high.

Arrangement Fees

It is worth noting that some Estate Agents will steer towards Banks or brokers that charge quite a high arrangement fee some as much as 1.5 %.

By working through specialist French mortgage brokers you can more often reduce the arrangement fee, get better terms and the broker's commission is paid directly by the Bank.

Furthermore you are likely to obtain more impartiality and a greater degree of assistance with the paperwork from a good broker than many Banks where you deal with the Bank direct.

We have links with two good French mortgage brokers the notoriety of whose fees are met by the French Bank, and who are able to pay us a commission which has the advantage that it can upon request be set against your fees. A further advantage is by working with brokers whom we know we are better able to assist you through the process from start to finish.