| Financial
Services > Mortgages
> Holiday
Homes > France
French Mortgages
- General Information
There are considerable
differences between
lending in France
and raising finance
in the UK. Whilst
the UK system applies
income multiples
(i.e. 3 x your gross
income) the European
view is based on
your ability to
repay the loan.
Most European banks
lend on the basis
that your total
monthly repayments
(capital and interest)
should not exceed
35% of your net
monthly disposable
income. To give
yourself some idea
of the maximum you
can borrow in France,
multiply your monthly
net income by 35%.
Then deduct from
this your total
U.K monthly credit
outgoings (loans,
credit cards, mortgage/rent).
The resulting figure
will give you a
good idea of your
maximum monthly
French mortgage
payment.
Generally, we
can arrange a French
mortgage up to a
maximum of 85% of
the lower of the
value or purchase
price of the property.
As a general guide,
the cost associated
with a purchase
of a previously
occupied property
equates to approximately
10% of its value.
The cost associated
with New Build property
will include TVA
(French VAT) at
19.60% charged on
the purchase price
although this will
normally be included
in the purchase
price quoted to
you.
Once you have chosen
your apartment or
house, you must
sign a preliminary
purchase contract.
For existing structures,
this contract will
take the form of
a " compromis
de vente “,
the equivalent of
an English agreement
for sale and purchase;
for a new property,
you will need to
sign a “contrat
de réservation”,
the equivalent of
an expression of
intent.
If you do not have
an existing French
bank account, consider
opening one when
you apply for mortgage
financing. This
will facilitate
setting up your
direct debit mortgage
repayments.
Once your mortgage
application has
been approved, you
will receive a loan
offer by registered
post. This will
be a formal undertaking
from the Lender
to you. The offer
is normally valid
for 30 days. At
the end of the 10-day
cooling off period
required by French
law, you simply
return the acceptance
form together with
the postal delivery
slip showing the
date on which you
received the loan
offer to the Lender.
A notary will prepare
the deed of sale
ready for your signature.
There is generally
a delay of approximately
three months between
signing the preliminary
sales contact and
signing the final
deed of sale. You
should expect to
pay notary and other
fees at the closing
when the final deed
of sale is signed
<<
BACK
|
