How will the Bank decide how much you can borrow?
French lenders look at the affordability of the repayments. Normally no more than a third of your net monthly income can be used to pay existing loans, credit card payments, child maintenance, mortgages or rental payments and your new French mortgage repayments. So if you bring home 1,500€ per month only 500€ can be allowed to service the payment of any debts. Overseas mortgage applicants are only able to borrow up to a maximum of 85% of the property purchase price including estate agency fees. You will need to find the money for the remaining 15% and the Notaire’s fees yourself.
French Banks lend on a repayment basis in almost all cases and will often fix the mortgage rate and repayments for the duration of the mortgage term. You will need Life Insurance to cover the debt.
Which documents will the Bank need to see?
- Proof of your identity – Passport or Birth Certificate
- Proof of address – A utility bill less than 3 months old or Income Tax or Council Tax demand
- Proof that you have savings to cover your deposit and Notaire’s fees and a proof of your Assets
- Your last 3 month’s bank statements – these need to show that you have not exceeded any overdraft limit and you may be asked to justify regular outgoing payments
- A copy of the Property Details if you have already found your new home
Proof of income
If you are employed you will need to provide :
- Your last 3 months’ payslips
- Your most recent P60
- A letter from your employer or contract
If you are self-employed you will need to provide :
- Your accounts for the last 3 years
- Your last 3 tax returns
- A letter from your Accountant
If you have additional, non-earned income from investments or rental income, you will need to provide proof of the regularity and amount of the income.
Proof of Outgoings
You will need to provide :
- Proof of your current monthly repayments on all loans, rent or mortgage
- Proof that your payments are up to date and your most recent mortgage statement
- A copy of your rental agreement or loan agreements
- Written confirmation of your maintenance payments and the duration they will be paid
If you would like to discuss your mortage optons please do not hesitate to contact me and I will be able to talk through your options and put you in touch with an expert who can help.
For an approximate idea of your montly repayments click here to go to our Mortgage Calculator.
Please note :
Information on this page is based on our current understanding of mortgage terms and availability for the purchase of French property. The calculator is for guidance purposes only and does not constitute a mortgage offer and does not take into account affordability or your personal eligibility. It assumes monthly payments on a repayment (capital and interest) based mortgage where payments occur at the start of each month with no deferred payment periods and a constant interest rate for the duration of the loan.
Your ability to qualify for a repayment or interest only French mortgage and the maximum loan amount depend on your personal financial situation. Please ask for more information.