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Setting up a French Mortgage is more complex than you might think!
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Firstly, you need to be aware that the LTV (or loan to value) available on a French Property 2nd home is significantly lower than you would be used to in the UK.
For instance, most lenders will only advance upto 75% of the property value - in the UK it is possible to achieve an advance of upto 95% on your home purchase!
That means, if you want to buy a £100,000 property, then you need to be able to place a deposit of £25,000!
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Secondly, the cost of purchasing a French Property (assume 11%) will require more upfront cash - as this cost can not be added to your mortgage.
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Lastly, your resident status will affect where you can borrow money (ie if you remain UK resident then you can borrow money from UK banks offshore branches - but this is not available to French residents).
Then you have to figure out how to get the purchase money from Sterling to Euros - and and whether you want a sterling based mortgage or a euro based mortgage.
For instance, if you are paid in Sterling and use this money to fund your French Property mortgage - then you might want the mortgage denominated in pounds. Otherwise, if the currency moves against you a Euro mortgage, whilst remaining the same in Euros, could become more expensive to fund with Sterling.
Lastly, even if you don't take out a mortgage, most people with a French Property (even if they decide to only visit it occasionally and live in another country) will open a separate French bank account to pay taxes and local bills.
There's lots more about this and help for you to establish the true costs of your purchase with French Property Secrets 2003 - the insider tips on how to find and buy your dream home AND make a good investment!
However, if you are ready for the small print, here are some very useful links that can get you started with the main finance issues:
Click here for a FREE French Property Mortgage quote
Some UK banks (and therefore English language applications and lending)
Abbey National Offshore
Halifax International Bank
Peterbourgh Building Society Gibraltar
