How to obtain a mortgage loan in France: requirements and conditions for foreigners

Loans for purchase of real estate in France

Loans intended for purchasing real estate in France continue to be an important topic of discussion, especially considering the global financial crisis that occurred between 2008 and 2009. Despite this economic upheaval, the housing market in the country did not experience significant negative consequences. Prices for residential properties only slightly decreased, and since 2016, there has been a steady growth.

Factors influencing the demand for mortgage loans

According to statistics, one of the main factors contributing to the increased demand for mortgage loans is the availability of low interest rates. Mortgage loans are in high demand among both local residents and foreign buyers.

• Loans with fixed interest rates are particularly in demand in the domestic market, which allows for stability in the repayment process.

Changes in legislation

In 2020, the government made a number of changes to the legislation regarding mortgages, which led to stricter requirements for borrowers. In particular, a limit was set stating that the monthly payment should not exceed one third of the household income, and the loan term cannot exceed 25 years. However, more flexible conditions were later introduced.

Current mortgage market conditions

The average mortgage rate in France in the second quarter of 2021 was around 1.06%. At the same time, the number of issued mortgage loans increased by 39.1% compared to the same period in 2020.

It should be noted that advertising campaigns on mortgage rates are actively pursued by various financial institutions.

Conditions for foreign borrowers

Nevertheless, for foreign borrowers, the conditions for obtaining a mortgage can be quite strict. This is because it is often more challenging for financial institutions to verify the income of non-residents. These measures have their positive aspects: government oversight of the lending market helps reduce the risks of a mortgage bubble, which in turn makes the market more stable and attractive to investors.

Expert opinion

Irina DuporA real estate specialist notes that in recent years, financial institutions have become much more cautious when approving mortgage applications from foreign clients. Borrowers with ties to the European Union are particularly valued, as well as those whose incomes significantly exceed the monthly loan payments.

• Preferably, the borrower's income should be four times the amount needed to repay the loan, excluding debts already owed.

Although having a residence permit is not a prerequisite, in practice it is much easier for EU citizens to get approval from French banks. Currently, despite all the difficulties, Americans face even greater barriers to obtaining mortgage loans.

Maximum loan amounts

The maximum amount of a mortgage loan that local residents can obtain can reach 100% of the value of the property being purchased, while for foreign citizens, this limit is set at 70%.

• As a result, most banks offer non-residents no more than 50% of the value of the property.

This creates certain obstacles for foreign investors looking to invest in French real estate; however, it also encourages the development of more flexible and adaptive solutions in the lending market.

Loans for foreigners in France

When applying for a loan for foreigners in France, banking institutions often require the opening of an account to which you must deposit funds sufficient to cover at least six months of the loan. One of the prerequisites is also the presence of an insurance policy on the borrower's life. In some cases, foreigners may be required to undergo additional medical examinations to ensure that the insurance coverage matches the actual state of their health. Another important requirement for non-European Union borrowers is to have real estate in any country.

Difficulties in obtaining a loan

Unfortunately, financial institutions in France are increasingly refusing to provide mortgages to clients who cannot clarify their financial situation. Non-residents without ties to the EU and not engaged in financial activities in Europe are required to demonstrate a high income to obtain a loan; otherwise, their applications will be rejected. However, for those looking to purchase property on the French Riviera, there are alternative solutions. For example, banks in Monaco, such as Edmond de Rothschild Monaco, Banque Richelieu Monaco, EFG, and Banque J. Safra, may offer more flexible terms.

Large banks in France

Among the major banks working with international clients in France are:

• BNP Paribas
• Société Générale
• La Banque Postale

Age limits and financial solvency

It should be noted that there are age restrictions for borrowers in the country, which range from 21 to 75 years old. The main requirement for obtaining a loan is the confirmation of financial stability and the presence of a legal source of income. The ratio between monthly income and loan payments is also important, and it should not exceed 35%.

Creation of a borrower file

Creating a quality borrower profile can be a complex process due to the different approaches banks take in assessing and classifying income. Compiling such a profile requires careful preparation and a substantial amount of supporting documents. To increase the chances of successfully obtaining a loan, it is advisable to turn to specialized agencies, as each financial institution has its own internal rules and local nuances. Success may also depend on the relationships and reputation of the agency director, as not every borrower can expect a positive outcome from the review of their profile.

Protecting the rights of property owners

It is important to note that in France, property owners cannot be evicted if they live in the property as their sole residence. Therefore, banks carefully examine the file of each borrower before making a decision on granting a loan. In the event of financial difficulties, the borrower has the option to negotiate with the bank to revise the loan terms, which may lead to a reduction in monthly payments and an extension of the loan term. This can be a solution for those who find themselves in a difficult financial situation.

Unique real estate offers in France

Today, there is a huge selection of exclusive real estate in France, characterized by a high level of luxury and comfort. One such offering is a magnificent villa located in Mougins, priced at around10 million eurosThis single-story estate covers an area of 650 square meters and is located in a gated residential complex, surrounded by greenery and a tranquil natural atmosphere.

The panoramic view reveals picturesque landscapes and breathtaking sea expanses. Just a 15-minute drive away is the international educational institution Mougins School and the famous Boulevard de la Croisette in Cannes.

The interior of this luxurious estate includes expansive areas such as:

• spacious living room with a cozy fireplace;
• a stylish kitchen, fully equipped with everything you need;
• wide dining room;
• six comfortable bedrooms.

This makes it an excellent choice for families or friendly gatherings.

Luxurious estate in Cannes

Another attractive offer is a chic estate located in Cannes, with a price of29 million eurosThis property covers an area of about 2000 square meters and is situated on a 30-hectare plot, built in 2011.

Uniquely located in the picturesque hills of St Jean de Cannes, this property offers stunning panoramic views of the seaside, creating an atmosphere of tranquility and privacy. This property is partially hidden from the eyes of passers-by, guaranteeing a high level of privacy for its owners.

Country villa in Nice

Those looking to purchase a country home should pay attention to a villa in Nice, which can be bought for1.9 million euros. The complex is located on a plot of 118 hectares and includes four different buildings with a total living space of about 1,000 square meters.

Here is a cozy two-story house with an area of 235 square meters, offering a picturesque view of the mountains, as well as a farm building with additional outbuildings and a stable. This charming corner of nature, located 40 kilometers from Nice, will be a great place for solitude and relaxation.

A villa in Théoule-sur-Mer.

In Théoule-sur-Mer is also presented a magnificent house for the2.1 million eurosWith an area of 475 square meters and stunning panoramic views of the sea and the Esterel mountains, this three-story house is equipped with an elevator and blends perfectly into the surrounding landscape.

Inside, there are six bedrooms, three of which have en-suite bathrooms, providing added comfort and convenience for residents.

Modern villa in Cannes

In addition, there is an opportunity to purchase a modern villa in Cannes at a price that varies depending on the features. The total area of this property is approximately700 square metersThe plot of land on which it is located has an area of 3200 square meters.

The unique panoramic views of the Bay of Cannes and the Esterel mountains make this villa particularly desirable. Inside the villa are:

• three spacious guest areas of 150 square meters;
• a terrace with a pool that seamlessly connects to a magnificent sea view.

A villa on Cap Ferrat

One cannot help but mention the villa located in Cap-Ferrat. This is an exquisite place, with an area of400 square metersis offered for sale for12.5 million euros. This accommodation is located in a prestigious area of the Côte d'Azur and offers its tenants mesmerizing sea views.

The exclusive house comes with:

• a bedroom with a separate bathroom and terrace;
• Four additional bedrooms, each of which also has a separate bathroom;
• a spacious and bright living room with a fireplace;
• a cozy dining room.

These features create the perfect conditions for comfortable living.

Conclusion

Thus, France offers a wide selection of luxury real estate, each with its own unique features and appeal.

Real estate in Bosolei

Real estate in Bosaile, located in France, offers unique opportunities for both investors and those looking to enjoy life on the Côte d'Azur. Notably, a new apartment with a total area of 100 square meters is for sale at a price of €1,650,000. This modern residential complex is situated in a special area near Monaco, known as the "golden square."

The building, consisting of 40 residential units of various sizes—from small one-bedroom apartments to spacious six-room options—features terraces and designated parking spaces in an underground garage for all residents. Bosoleil is located just a few steps from the borders of Monaco, making it particularly attractive.

Luxury villa in Nice

In addition, there is an amazing offer in Nice — a magnificent villa priced at €2,100,000. This property covers an area of 540 square meters and includes six bedrooms with a thoughtful architectural layout.

The villa features a tennis court and a swimming pool, as well as breathtaking views of the sea and the famous Gattière Castle. It is located in the picturesque heights of Saint-Jeannet, just 15 minutes from Nice Airport. The complex includes a main building of 430 square meters and an additional guest house of 110 square meters, all surrounded by a well-maintained area of 11,110 square meters.

New apartments in Nice

New apartments are also available in Nice, priced at €775,000. These four-room apartments have a total area of 83 square meters. In addition, there is a terrace of 46 square meters and a private garden of 160 square meters, located in a modern three-story building consisting of 16 apartments.

The location on the heights of Nice provides fantastic views of the sea, the city and the surrounding hills. A park and swimming pool are also provided for residents.

Luxurious villa in Saint-Jean-Cap-Ferrat

If you are looking for a luxury villa in Saint-Jean-Cap-Ferrat, consider the option priced at €10,600,000 with an area of 250 square meters. This modern building is located in one of the most prestigious and beautiful areas of Cap-Ferrat, just a few minutes away from the Grand Hotel and beach areas.

The villa offers a magnificent view of the sea and beautifully landscaped green areas.

A unique opportunity in the market

We present to you a unique offer in the market — an opportunity that is hard to miss! At the moment, you can take advantage of an impressive 85% discount! We are pleased to introduce you to a magnificent villa with an area of 232 square meters, located just a few minutes' drive from the luxurious grand hotel in Saint-Jean-Cap-Ferrat.

Description of the main house

The main building includes:

• spacious hall,
• a bright and spacious living room with a cozy fireplace,
• a dining area where the kitchen is designed in an American style, smoothly transitioning into an open relaxation zone.

On the second floor, you will find a bedroom that provides an atmosphere of privacy and relaxation.

A villa on Cap Ferrat

In addition, RFC Estate offers a wonderful villa priced at6,000,000 euroslocated on the picturesque Cap-Ferrat peninsula, with a total area of 230 square meters. This offer includes:

• four bedrooms,
• a credit system with very low interest rates, starting from0.85% to 1.85%.

The 14-acre plot is designed in a charming Provence style, where you will find a well-maintained garden and a cozy studio for the staff. On the first level, there is an open-plan American-style kitchen, a dining room, and a living room, as well as a comfortable guest bedroom. On the second floor, you will find three additional bedrooms with en-suite bathrooms, ensuring maximum comfort for the residents.

Investment opportunities in Nice

If you are looking for profitable investment opportunities, Nice offers a variety of interesting options. Here you can purchase apartments with an area of76 square metersincluding three rooms and two bathrooms, located in a small condominium on the waterfront.

This wonderful duplex with southern and western exposure on the first floor offers a convenient layout:

• hallway,
• modern kitchen,
• a spacious bedroom with a built-in wardrobe,
• a bathroom with a toilet,
• an elegant corner living room with access to a balcony offering a beautiful view of the sea.

There is another bedroom with a shower on the attic floor.

Apartments in Nice

We also have stunning three-room apartments in Nice with an area of88 square meterswhich include 3/4 rooms and additional amenities:

• terrace,
• parking
• basement.

These apartments are located on the third floor of a residential complex with an elevator in the prestigious Mont Boron area. The apartment has been fully renovated using the finest materials, and there is the possibility of converting it from three rooms to four.

Housing inAntibes and Cannes

For those interested in housing inAntibes, we are pleased to offer a new residence just a few meters from the beach. Additionally, there are attractive apartments available in Cannes with a total area of83 square metersconsisting of three rooms, two bathrooms, and two toilets.

Spacious apartment with an area of71 square meterswith a terrace on12 square metersLocated on the penultimate floor of a well-maintained residence with a concierge.

Three-room apartment in Cannes

And finally, it's worth noting the beautiful and bright three-room apartment in Cannes with a total usable area.97.50 square meters, with a terrace area15 square meters...located on the penultimate floor of an elegant residential complex. This apartment, with windows facing east and west, offers picturesque views of the city and the Petit Juas area, as well as partial sea panoramas.

The layout includes a luxurious hall that leads to a bright living room, as well as a separate kitchen, perfect for culinary experiments and warm family dinners.

Villa in Nice

A magnificent villa is for sale in Nice, France, offered by immops in collaboration with groupe avs. The price of this luxurious property is 2,450,000 euros. The total living area reaches 303 square meters and is located in the picturesque area of Bas Fabron, just a few minutes' walk from the sea.

The building, constructed in 1926, exudes the charm of the Belle Époque era, attracting with its elegant lines and atmosphere of antiquity. The structure includes three levels, featuring a cozy living room with a warm fireplace, two bedrooms, and a kitchen on the main floor.

Amenities of the villa

On the upper level, there are five bedrooms, each equipped with its own bathroom. The first floor offers additional amenities, creating a harmonious atmosphere of luxury and comfort for the residents.

Real estate financing

When it comes to financing, obtaining a loan from international financial institutions is becoming an increasingly relevant topic. As practice shows, potential borrowers who work for prestigious foreign companies and have stable legal incomes from various sources have a better chance of having their loan applications approved.

• Fulfillment of tax obligationsThe presence of foreignreal estate positively affects credit reputation.

According to Alexander Matsulevich from serviceazur, even with property in France, many Russians become clients of banks in Monaco. It is important to note that the process of obtaining a loan begins with a thorough analysis of the borrower's financial data.

The process of obtaining a loan

First of all, a compliance check is required, which may take some time. Banks in Monaco are cautious about their reputation and thoroughly verify their clients' financial information before opening an account for them.

Our services

In recent years, our company has been actively involved in real estate transactions and is ready to offer its services in these deals. One of the distinguishing features of banks in Monaco compared to French banks is the mandatory opening of a deposit account with a minimum amount of 500,000 euros, which serves as a guarantee of the client's financial solvency.

Requirements for real estate

When it comes to real estate requirements, banks in France pay attention to the quality, liquidity of the property, and the absence of encumbrances. When purchasing an apartment from a reputable developer, a preliminary appraisal may not be necessary, as banks often trust such developers.

• In the case of secondary real estate, an appraisal from a certified expert is mandatory.
• He confirms that the price is in line with market conditions.

If the established value turns out to be below the required level, the bank will reduce the loan amount. Irina Dupor from immoconcept noted that the preliminary appraised value should be at least twice the loan amount. In the case of new construction projects, banks also take into account the reputation of the developer.

The role of credit brokers

In today's reality, many developers, aiming to establish connections with financial institutions, engage mortgage brokers to assist their clients in the process of obtaining a mortgage loan. These specialists play a crucial role in helping borrowers navigate the complex and multi-step processes of securing loans.

The process of buying real estate

When purchasing apartments in new buildings from large developers, inspections of the properties are usually not conducted, as banks generally trust these companies.

Unlike the primary market, the situation in the secondary market is different: banks send an appraiser to the property, who conducts a professional analysis. Clients are often not informed about this process. Typically, the costs of the appraisal are already included in the commission fees that the bank charges for processing the loan application.

Information about villas inAntibes

Comprehensive information about villas inAntibes can be found on various resources. The cost of the appraiser's services varies depending on the characteristics of the property being evaluated. For example, the appraisal of a plot with several buildings may cost around 4-5 thousand euros, while the appraisal of a villa valued between 1-2 million euros will be approximately 2 thousand euros.

Mortgage conditions for buyers during the construction phase

It's important to noteWhen purchasing real estate during the construction phase, potential buyers can include a condition in the mortgage agreement to suspend loan payments until the construction is completed and income from the property begins.

Documents for mortgage processing in France

To apply for a mortgage in France, you need to prepare a number of documents. Here are the main ones:

• Application for a mortgage loan according to the bank's established template.
• Foreign passport and its copy.
• Marriage or divorce certificate, as well as a prenuptial agreement, if available.
• Preliminary agreement for the purchase of real estate.
• Contract with the developer when purchasing property in a building under construction.
• A certificate from the workplace indicating the position and salary amount.
• Tax returns for the last two years and pay stubs for the last three months.
• Employment contract, if there are hired employees.
• Bank statements for the last three months.
• Documentation confirming additional sources of income, such as from rental properties or bank deposits.
• Certificate of property ownership and receipts for utility payments.
• A schedule of monthly payments for active loans and credit agreements, if they exist.
• Tax returns, as well as incorporation documents and reports for the last three years for individual entrepreneurs.

Additional requirements for foreigners

Foreigners wishing to purchase real estate in France with the help of a mortgage may need to provide additional documents, such as a medical certificate. All documents must be translated into French and notarized.

Mortgage processing times

The mortgage application process involves the bank reviewing the application within approximately 30 days, but recently the processing time can significantly increase due to the rise in the number of applications.

In case of approval, the client receives an official mortgage agreement, which includes a complete description of the terms, a payment schedule, and information about late payment penalties, as well as the option for early repayment of the loan (offre de prêt). It is important to consider all the nuances to arrange the mortgage as efficiently and quickly as possible.

Waiting period after submitting the application

In the first ten days after applying for a mortgage, the borrower is not allowed to sign the contract. This time period is designed for the client to understand the loan terms and evaluate all the details of the deal.

Signing the contract is an important step: once it is completed, the bank transfers the funds to the notary within a week. The notary, in turn, includes a clause about the financing in the purchase agreement and registers the encumbrance on the property being acquired.

Key features of the mortgage product

Mortgage products have a number of key features:

• Currency of the loan:Most often, it's the euro.
• Loan amount:from 50% to 65% of the property's value, in some cases reaching 70%, but not less than 75 thousand euros.
• Loan terms:can vary from five to one hundred and twenty-seven years.
• Interest rates:fluctuate between 1.6% and 2.0%.
• Borrower's age:must be between 21 and 75 years old.
• Early repayment:It is possible, but a penalty of up to 3% of the remaining loan amount may be applied.

Conditions for foreign citizens

For foreigners, the maximum amount of a mortgage loan can reach 70% of the value of the property being purchased. However, many banks prefer clients who can contribute 50% of their own funds to the transaction.

Interest rates for this category of borrowers range from 1.6% to 2%, depending on the specific mortgage product and the individual characteristics of the borrower.

Types of mortgage loans

There are several main types of mortgage loans with different interest rate systems:

• Fixed-rate mortgage:A fixed-rate loan is considered the most stable option, as the monthly payments remain unchanged for the entire loan term. To change the terms of such a loan, the borrower will have to go through the refinancing process.
• Variable interest rate loan:The interest rates on such loans (variable rate loans) are tied to the EURIBOR — the European interbank interest rate, which is reviewed every three to six months. The borrower can minimize risks by including a clause in the contract about the limits of interest rate changes.
• Credit with a mixed interest rate:where the initial interest rate is fixed, and later there is a transition to a floating rate.

Credit in fine

A fine credit is a unique type of loan where the borrower pays only interest, and the principal amount is repaid only at the end of the loan term. This is made possible by opening a special savings account, into which the client deposits money monthly.

These funds can be used to pay off the principal amount of the loan or can be paid in a lump sum at the end.

Mortgage for investors

When it comes to mortgages for investors, loans such as in fine or contracts with floating interest rates are often chosen in these cases. These credit products have their advantages and allow for more flexible management of real estate investments.

They provide the opportunity to optimize financial flows and better meet the specific requirements of investors.

Conclusion

The mortgage lending market in France is a complex and multifaceted structure that requires a deep understanding and careful approach from both local and foreign borrowers. The global financial crisis of 2008-2009 did not significantly impact this sector, and since 2016, we have been witnessing a steady increase in real estate prices. One of the key factors contributing to this growth is...low interest ratesthat made mortgage products more accessible.

However, despite the overall stability, the new rules introduced in 2020 have significantly complicated the lending conditions, which may impact the market in the future. Strict requirements for borrowers, especially for foreigners, reflectcautious approach of banksand their desire to avoid potential risks. This creates additional obstacles on the path to obtaining a mortgage, but at the same time, it protects the stability of the financial market.

Preparation of the dossier

I also want to emphasize the importance of a proper approach to preparing the dossier, which requires time and effort. There are many nuances to consider, such as:

• The bank's attitude towards different types of income;
• The policy of a specific lender.

Seeking professional help from agencies can significantly increase the chances ofsuccessful loan approval.

Final thoughts

Finally, it is worth noting that despite the increasing demands and challenging conditions for foreigners, there are always options and alternative solutions for borrowers looking to purchase real estate in France. For example, banks operating in Monaco can offer more favorable terms.flexible conditionsAll of this indicates that the mortgage market in France remains attractive to investors, and despite some obstacles, opportunities for successful investment still exist here.