When looking to buy a property in France, you may look into getting a mortgage in order to finance the purchase.
As with any mortgage, the process can be complex and drawn out. This is before you even consider the additional wrinkle of getting a mortgage across borders.
There are many different ways you can approach getting a mortgage on a French property as a UK expat, from going directly to a French bank to getting developer financing.
In this article, we’ll explore a few key avenues, so you can decide the best path forward for you.
Getting a French mortgage
One of the first avenues you may consider when buying a property in France is to seek a mortgage from a French bank.
Many French banks offer mortgage products specifically designed for non-residents. These banks often have English-speaking staff to assist international clients.
To obtain a mortgage from a French bank as a UK resident, you can choose from various mortgage types, such as fixed-rate, variable-rate, and interest-only mortgages.
Eligibility generally requires proof of income, a good credit history, funds for a deposit, and a favourable debt-to-income ratio. You’ll of course be required to submit evidence to support your application.
French interest rates can be competitive compared to the UK, although it’s important to note that rates are always changing and vary from lender to lender. The main drawback of getting a French mortgage is that non-EU buyers will typically need to pay a larger deposit, which is usually around 25% to 50%.
And while the bank may have English-speaking staff, working with an overseas lender can add another element of complexity to the process.
Mortgages from international or UK-based banks
Some international banks with a presence in both the UK and France provide cross-border mortgage services. These banks can offer tailored products for British expats and facilitate the process due to their familiarity with both banking systems.
Obtaining a mortgage from an international bank with a presence in both the UK and France offers several advantages.
These banks are familiar with both banking systems, providing a smoother and more integrated process for UK residents buying property in France. For instance, it may be easier for you to prove your credit history, if the bank has access to your UK credit report.
Eligibility is very similar to that of a French bank – you’ll need a good credit history, a deposit, and the same required documents.
One potential disadvantage is that you might face a higher interest rate with a UK-based international lender. On the other hand, a typically smaller deposit requirement could unlock more property options for you.
Developer financing
For those purchasing new properties directly from developers, some offer financing options that can be more accessible, particularly for non-residents.
Developers may be more flexible than traditional banks, with options that can include lower down payments, competitive interest rates, and simplified qualification criteria. However, the terms and conditions vary from developer to developer, so it's important to carefully review any offers.
They may also allow you to borrow for an off-plan home, which some banks may not be willing to lend for.
While the process may be more convenient, buyers should be aware of potential language barriers and may need translation services. It is also advisable to consult a lawyer to ensure full understanding of the terms and to help navigate any legal complexities involved.
Our top tip: getting expert help
Overseas mortgages can be complicated, and you can usually save yourself from stress and unnecessary expense by hiring a few experts to help you out.
If you’re considering either mortgage option, hiring a mortgage broker who specialises in French property for UK buyers can be invaluable. With their experience and expertise, they could simplify the process and help you get a much better deal.
It may also be beneficial to speak to a financial advisor or accountant , as they may offer useful insights into things like tax liabilities.
Having a lawyer on your side is also advisable. They can handle the legal aspects of the loan, review contracts, protect your interests and ensure everything is above board.
Meanwhile, an independent translator can help you navigate the language barrier.
Last but not least, using a specialist currency broker could save you a significant amount of money if you need to transfer funds to France as part of the mortgage process – whether it’s a lump sum for the deposit, regular mortgage payments, or for the many other costs associated with buying a property in France.
That’s where we come in.
How Currencies Direct can help
Our job is to get you the best possible deal on your currency transfers, whether it’s a large one-off payment or a series of smaller transactions.
We do this by offering a range of transfer options – such as fixing or targeting an exchange rate – to help you navigate volatility in the currency market and make the transfer when the rate is in your favour.
You’ll also have support from your own dedicated account manager. They’ll guide you through the options and keep you up to date with market insights, making it easy for you to get a great deal.
These services – paired with our highly competitive exchange rates and zero transfer fees – could save you thousands of euros when buying a property in France, depending on the size of your transfer.
We can also set up automated transfers to go out monthly or quarterly, perfect for your regular mortgage payments.
If you want to find out more about our services, you can get in touch with our team today. Alternatively, you can open a free account in minutes and speak through your plans with a friendly account manager.
