MORTGAGES IN FRANCE

It is generally not too difficult to obtain a mortgage to purchase your property in France and we provide a free service to give you advice, and introduce you to the best French banks or French mortgage brokers. However, there are certain things a potential buyer needs to know.

Firstly, when you sign the reservation contract at the sales office, you must have already decided whether or not you are going to take out a mortgage because you will be asked by the sales person to write out a sentence on the contract in French, and sign to say if you are not having a mortgage.

Secondly you must have your mortgage arranged and agreed on before you sign your “acte de vente” at the notary’s, usually 2 to 3 months after you have signed your reservation contract, if you are taking one out.

There are various options as to where to obtain your mortgage or funding to finance your new purchase.

Mortgage through a French bank

French banks are becoming more and more aware of the importance of the mortgage market in France and as a result are very keen to lend money and at very attractive rates and terms.

A mortgage broker

To take a lot of the hard work out of hunting around for their funds, some of our clients obtain a mortgage through a broker, who will sift the market place for the best deal, one that suits your circumstances best. AIG Immobilier have assisted hundreds of British and international property buyers in finding French mortgages and we will be happy to recommend reputable brokers to you.

The legal costs of buying in France are generally 2.5% (or 1.5% if no mortgage) for a new property and 7 to 10% for an older one, but again you will be advised of the costs when signing your reservation contract. The actual process of applying for mortgages in France, again is not difficult, and usually takes at most 2 to 3 weeks but can usually be done even quicker. If you are going the French bank route, most of the application can be done by phone, but you do have to visit the bank in France at least once in person, before you go to the notary’s. The actual application form, wherever you apply, is very similar, asking questions like date of birth, current address, income, expenditure, current mortgage, employment etc. and again your AIG Immobilier Agent can offer help and guidance to make the application quick and painless.

So in summary, obtaining a mortgage for a French property is generally not difficult, especially with our help, and will not stand in the way of you obtaining the dream apartment or villa you have always wanted, on Lake Annecy or in the French Alps.

MORTGAGE REQUIREMENTS

These are the basic documents to send following your mortgage application in France:

• Reservation contract or the “Compromis de Vente.”
• Personal details, ie. Copy of passport.
• Last 3 complete tax returns or last 3 payslips with the P60
• Any document showing you have the funds to pay for the percentage of the cost not covered by the mortgage (for instance a bank statement).
• Last 3 statements of your personal current accounts
• If self employed, a professional “Curriculum vitae”
• If you have other loans, their depreciation schedules.

The French banks will only take into account a third of your actual income; your assets and they will then make you an offer.

Please note that when buying a property in France with a mortgage, there is an additional mortgage fee as a perecentage of the loan. The property is mortgaged or hypothéqué. But for upfront purchases, the property is non-hyphothéqué or mortgage -free.

BANK ACCOUNT IN FRANCE

Opening a bank account in France is essential both to pay the monthly instalments on your mortgage, to settle different bills related to your property and to receive your property income. In order to open an account in France, you have to bring the necessary documents listed below, fill out the current account application form and the bank will send you your account details (the so called RIB).

To open an account in France, you need the following:

• A copy of your passport or identity papers
• Proof of address
• A copy of your last 3 bank statements

What is a RIB? It stands for Releve d’Identité Bancaire (bank account identity slip), is provided by your bank and contains all the details about your bank account: Bank ID, identification of the branch holding your account, account number, control key (clé RIB), domiciliation and address of the branch. It also includes your international Bank Account Number (IBAN) and the international bank identification code (BIC). This identification slip is designed for your French (or foreign) creditors and debtors who need to carry out operations on your account (credit transfer, payment, etc).

Document non-contractual.
Whilst every care has been taken in preparing this document, AIG Immobilier are not  responsible for any errors. Laws can and do change. Before signing any binding contract we advise you to take legal and tax advice by a professional in that field.