10 year low for EU Central Bank rates

The EU central bank today confirmed that it was keeping its rates steady at 1.00%. This rate has been in effect since May of this year and continues to provide support for French property prices which remain stable according to the November press release from the FNAIM, the national Federation of estate agents in France. Average property prices rose in October by 0.6% and the overall drop in the average price of French apartments and houses is now reckoned at 5% for the year. With the Eurozone and France both now having exited the recession and showing signs of growth the outlook is positive for rates for mortgages in France and French property prices.

Although the news today came as no surprise, it is interesting to see that the general consensus for the way in which the French mortgage market and French property market will evolve is currently going to plan. If we look across the water to the US figures released today from a survey by Freddie Mac, the giant US government owned mortgage syndication company, indicated that 30 year fixed rate mortgages are now at their lowest level for 10 years. The rates for these mortgages have been falling for the last 5 weeks and now stand 4.71% down from 4.78% just one week ago according to Reuters news agency. Variable French mortgage interest rates are very low starting at just 2.3% and with the rates for long term loans also decreasing, now standing at 4.5% for a 30 year fixed rate in France at 80% LTV, showing that the money from the economic stimulus packages is definitely filtering into the global economy with many institutions now ready to borrow huge sums and to lend this money on into a rising market over the next 20 years.

So what does this all mean for the outlook for the French property market? Well, it would seem that prices will inevitably start rising as the money from the quantitative easing finds its way into the hands of those who are capable of obtain a mortgage in France. The timing and scale of the increases depends on the speed at which the economy takes off again but certainly within 5 years the increases in French property prices would realistically seem to be substantial providing the period of unconfident growth we are entering only lasts for 3 years. The effects of inflation, energy prices, unemployment rates and of course confidence will all have their parts to play over the coming 12 months making this a very interesting time for both French property and French mortgage markets.

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EU inflation and French mortgages

With the news today that inflation has return to the Eurozone, what does this mean for the outlook for interest rates for French mortgages? The increase in consumer prices for the month of November marks the end of a five month cycle of deflation across the European economic area. The 0.6% rise was driven largely by rises in energy prices which are common at this time of year but exacerbated by the returning trend for oil speculation with traders finding it cheaper to store the oil and to take orders for delivery in six months time. This practice serves to drive up the prices but reducing the supply in the face of increasing demand as oil consuming companies look to hedge against rising costs.

This increase in inflation will increase pressure of the ECB to raise the rates for French mortgages but the pressure to not halt the shoots of growth in the economy with jobless figures still rising will mean that in the short term interest rate rises are still quite unlikely. In the longer term inflation and growth will take a firmer hold, bringing increases in French property prices as investors continue to move out of cash and into assets such as gold and property to avoid the erosion of their net position due to rising inflation. However, with the return of confidence to the market we are predicting in early 2010 and the activity in the market for ski properties we may actually see French lenders starting to decrease their margins slightly and thus their rates for French mortgages will fall in the short term, in order to remain competitive.

If you are looking to purchase in France in the coming months then it would be a good idea to speak to your broker for an up to date view on the timings of any of the rate decreases and when the each individual French bank publishes their rates in order to get the best deal. Alternatively, you can view our current best buys for mortgages in France.

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Outlook good for low mortgage rates in France

With the reaction on the FTSE today to Mervyn King’s announcement that mortgages rates look certain to stay low in the UK despite a coming spike in inflation, the outlook for low mortgage rates in France. Fortis bank announced today that it was selling bonds covered by ECB collateral bring liquidity to the market again. Two other major French banks also announced that they were also using mortgage backed collateral to raise further finance into an increasingly competitive market for mortgages in France. We have noticed several banks dropping the margins over the Euribor for variable rate mortgages in France in the past few months with many lenders now back to margins below 2% having dropped the margins by 20% or more.

Low rates and the availability of up 100% finance for French home loans provide those with good levels of income to secure a French property despite the strength of the Euro. We have seen continued growth in the numbers of enquiries over the last month with a further increase of 15% in the number of people applying for a mortgage in France through Athena Mortgages. We can offer a good snapshot on potential new loan offers and rates from the major and niche lenders in France. Our service levels are excellent and our brokers professional and friendly, helping all those who apply with us an excellent package for properties in France. The best way to find out what is happening in the France mortgage market is to talk to one of our brokers and for those looking for the current best buys for French mortgages can find them here. Best buys for Mortgages in France for leasebacks, second homes, buy to lets and equity release.

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French mortgage best buys for mortgages in France

Finding the best buys for mortgages in France can take some time. Is it best to go for a bank near to the location you are buying in or is it better to search for the best buys with a French mortgage broker? The answer probably is a combination and depends partly on the time you have available to commit to finding the best buy and the level of you spoken and written French. The main problem with dealing with local French banks is that the majority are not equipped to deal with an English speaking customer, just as you might say the local branch of Bristol and West does not have multi-lingual speaking customer services to service buyers from France or Russia. By comparison a French mortgage broker with the right connections can provide the services of personal French banker who speaks English for the princely sum of €44 per year as well as handling all the necessary paper work for you to obtain the French mortgage you have selected.

Athena Mortgages offers a free best buys comparison table which helps you to see at a glance some of the best buys for second home mortgages in France, best buys for leaseback mortgages in France, best buys for buy to let mortgages in France and best buys for equity release mortgages in France. This comparison table offers much more than the usual short synopsis found on other sites at it includes notes on the how the mortgage product works and early repayment charges meaning you can review some of the best options fully. The table can be found here at French mortgage best buys for mortgages in France.

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ECB keeps rates on hold at 1%

Another month, another hold by the ECB who do not feel that the Economy is in a good enough state for the various stimulus measures to start being withdrawn. he does want EU governments to get their books and order and to plan an exit strategy from the recession. Clearly the noises here are the beginnings of the upturn from where I'm standing. It may take a few more months but the signs are that confidence with blossom in the spring with the majority of the EU economies growing again.

It does not seem like the economies will really take off, especially with unemployment still rising and EU unemployment predicted to rise to 10% in 2010. These times will prove a struggle for many but the fact remains that a large percentage of society will pass through this 'economic crisis' without suffering any impact on their lifestyle or net financial position. Those in that position in fact have an opportunity to take advantage of the historically low French mortgage interest rates to invest in material assets which will be a good place to have equity if the anticipated inflation from the quantitative easing filters through in the next few years.

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Why buy French property now?

Ok, I know it seems like we might be a bit biased given that we spend our time arranging finance for second homes and investment properties in France but I genuinely think it is a great time to be buying property in France.

Let's look at what's going on. ...

Interest rates at historic lows, so it won't be getting any cheaper to finance

Discounts available on properties in some areas, good time to buy to maximise returns

100% French loans available, no need to worry about strength of Euro for currency exchange.

During a long chat with a journalist today, I convinced myself now really is a great time, perhaps another golden time for getting finance in France and snapping up undervalued French assets. One of the main reasons people are put off from going for a property in France is that the Euro is strong. For example a 30% (€60k) deposit on a €200k property costs £54k@ the current exchange of 1.11 euros to the pound. Now the same €60k used to cost £46k when the exchange rate was 1.30 a difference of £12k. Which might be enough to make you think twice but using a high level of finance can reduce the impact of the current exchange rate.

Let's look at the figures on the back of an envelope:

Purchase price €200k

Purchase costs €15k (£13.5K@1.11 or £11.5k@1.30)

Rental income €8k

Cost of €200k mortgage @ 4% over 25 years €12.5k

Balance to pay for the year mortgage cost less rental income €4.5k (£4k@1.11 or £3.5k@1.30)

So the difference over the year between the exchange rate now and a usual level is just £500, which does not seem like something to stand in the way of taking advantage of the bargains on offer. Of course the strategy would be to use the deposit later to pay off a chunk of the capital on the mortgage and to reduce the monthly payments when the exchange rate improves and the pound gets stronger again.

So with all of the above it just seems like there are few reasons to delay you purchase in France, which you do seem interested in having finished this post. So why not give us a call on +44207 471 4515 and we can get started.

Athena Mortgages ©

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French mortgage comparison tables: Things to look out for.

Using a French mortgage comparison table is a good method for comparing the differences between mortgages in France. A few sites offer such tables but generally these French mortgage comparison tables do not go into much depth, encouraging a click to fill in an application form or prompting a call to the French mortgage broker to clarify the situation. This trend is quite sensible in fact as due to the complexities of the French mortgages on offer make it quite difficult to display all of the salient points, rendering the comparison simply of the latest rates for French mortgages relatively meaningless.

For many years French banks have used an introductory rate, generally fixed for 3 months to make an attractive headline number which many buyers in France have been drawn to when browsing French mortgage comparison tables believing that mortgages in France are similar to those in the UK. We believe that these introductory rates are a sham and should be ignored as the key rate when taking any mortgage in France which has a variable element, is the margin which the bank applies to the European Interbank Offered Rate (Euribor).

The majority of tracker mortgages in the UK track the Bank of England Base rate which moves in the main once per month. French mortgage trackers, on the other hand, track the European Interbank Offered Rate which fluctuates on a daily/hourly basis, meaning rates can fluctuate less obviously. The Euribor is the rate at which euro interbank term deposits within the euro zone are offered by one prime bank to another prime bank. Now on average these fluctuations are not huge and the disparity between the European central bank base rate and the 3 month Euribor is not more than 0.3% and currency the 3 month Euribor is in fact below the ECB base rate of 1% at time of writing.

So search for good French mortgage comparison tables and make sure you find out the margin and which Euribor index your tracker rate will be based on. Just follow this link to our French mortgage comparison table which gives you an idea of how we think the information should be presented so that you can compare the different French mortgage options properly.

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French equity release mortgages in France gaining in popularity

French equity release mortgages are increasingly popular with our clients at Athena Mortgages with many new enquiries coming in daily. The main reason for the interest is of course the exchange rate which has the euro very strong against the pound and a large basket of currencies.

Those who bought in the last few years borrowing against equity in their property in the UK or elsewhere to profit from the strength of the pound to purchase a dream or bargain property in France are now reaping the benefiting by releasing that equity in France, converting the funds to Stirling with a profit approaching 25%. Some of our recent clients are using the windfall to pay off a portion of their UK mortgages, fund new ventures or additional properties.

Getting an equity release mortgage in France is simple. You can remortgage your existing property up to a value of 85% using standard french mortgage products, subject to an affordability check, providing the supporting documentation and valuation. French equity release mortgage rates start from 2.9% on a variable rate basis and with current fixed rates for equity release mortgages in France starting at approximately 4% of a 5 year fix.

We are always ready to help you find out what the options are to find your plans and circumstances, so for a free and personalised review just follow this link to find out more about what paperwork is involved in getting French equity release mortgages in France or call +44 207 471 4515 to speak to Erwan, Laure, Arthur, Ryan, Mathilde or John.

Athena Mortgages ©

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Eurozone expected to exit recession on Nov 13

The EU statistics offices anticipated to announce that the 26 nations that make up the Eurozone will officially exit recession and return to growth. In fact economic confidence in the Eurozone one was at it highest levels for a year in last month due in to increases in factory orders and production.

Inflation is trending down with no increases to the ECB benchmark rate anticipated until 2010 when a .25% rise is priced into the markets currently. Of course things can change and new information becomes available all the time. As in the UK, Eurozone home loan lending is up with these mortgage approvals boosting confidence in construction on both sides of the channel.

There is still uncertainly in the market which is good news for those looking to negotiate discounts for French properties or borrow money from French banks as the lack of inflation is keeping interest rates low. For a list of the best French mortgages available just click the link.

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French home loans: Finance for US buyers of French property

Every American has a second home in France - Thomas Jefferson

The historical links between America and France are well known, from the Statue of Liberty to the connections of WWII. The fascination of Americans with France is understandable drawing many visitors and prospective homeowners each year. The numbers of American buyers in France has been increasing in recent years but with the current economic conditions and the difference in the exchange rate, enquiries from the U.S. have dropped significantly over the last 18 months. Now that lending conditions in France are better than most developed countries a French home loan is often the best bet for buyers from the United States of America as a way to finance a property in France. Given the strength of the Euro it definitely makes sense to finance the purchase in France with a high loan to value French home loan. As noted elsewhere on this blog, there is currently a lot of competition in the market for home loans in France with several banks reducing their rates but up to 15%.

Although French banks do favor borrowers from the EU over those from other countries, there is generally no problem in getting finance for a French property for a US citizen. There is generally no additional paperwork required in order to secure finance in France. Opening a bank account in France is simple with Athena Mortgage's French current account service, a bank account can be opened within 24 hours and the newly launched French Paperwork Assistance will also take all of the hard work out of owning a property in France.

To find out more about French home loans and finance in France for U.S citizens please visit www.athenamortgages.com

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Fastest French Mortgages-How quickly can you get a mortgage in France?

The key to getting a mortgage quickly in France is to build up the required documents to support you French mortgage application. One of the longest delays in processing a mortgage application in France is getting a complete dossier to the bank. An experienced French mortgage broker can help you to organize the information and documents into a format that is acceptable to the majority of French banks.

As with everything in life, there are often specific circumstances that lead to a mortgage being required urgently and perhaps not all the documentation is not available immediately. In this case, a good French mortgage broker can significantly increase your chances of securing a mortgage in France quickly by placing your application with a bank that requires less documentation or can proceed to make an offer without all the documentation in place.

In general the stages to getting a French mortgage are as follows:

1. French mortgage application documentation complete
2. French Bank receives the completed file
3. File is studied and a decision in principle is issued
4.Depending on the connections the broker has a formal offer can be issued within 24 hours.
5.Once you receive the offer you may accept it after a 10 day cooling off period.
6. You have you offer confirmed and ready.

So all things being equal the fastest French mortgage from beginning to end would be 12 days but a slow broker could make the process much much longer. Athena Mortgages has offices in London, Paris and Dublin and may in exceptional cases be able to move slightly faster. It is important to note that in most cases if you do not securing financing for the property in France you have signed a sales agreement for, there is usually the chance to receive your deposit bank, providing you have respected the appropriate timing stipulations. However, if you have a French mortgage problem, no time to lose, maybe you should hire the A(thena) team. Pelase follow this libk for further information if you want a French mortgage now.

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Latest rates for fixed and variable rate mortgages in France decrease

The latest news from France is that rates are decreasing due to competition for mortgages between banks. One of the biggest specialist French mortgage lenders has recently dropped its rates by 15%. This 15% rate drop is anticipate to spread through banks that offer mortgages in France and interestingly the drops apply to both the spreads/margins the bank charges above the Euribor* on the loans and the initial rates.

For the variable repayment French mortgage, the rate which was previously 2.8% and has now dropped to 2.3% with a margin over the Euribor* of 1.3%. For a five year fixed rate French mortgage the rate was 4.25% with the current rate now standing at 3.95%.

These are some of the best rates for mortgages in France currently and also compare very favourably with rates for mortgages in the UK. Having been personally looking for borrowing in the UK recently the remortgaging options where all for fixed rates over 5% and for a variable rate mortgage the spreads/margins over the base rate were all over 2% for a 75% LTV mortgage.

To find out what the latest, best rates are for fixed and variable rate mortgages in France just visit the best French mortgage rates section on the Athena Mortgages website

*The Euribor (Euro Interbank offered rate) is the equivalent of the Bank of England base rate in the UK. Most French mortgage rates are pegged to the Euribor which, unlike the Bank of England base rate, fluctuates everday. Essentially, the Euribor is the rate at which European banks will lend money to each other for period of time e.g.3,6 or 12 months. as of time of writing the current Euribor rates are as follows. 3 month 0.730%, 6 month 1.019% and 12 month 1.254%.

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Fast French bank account opening at distance

Choosing a French bank account can be a bit daunting but the general rule is that you definitely get what you pay for. The free bank accounts generally do not offer Internet banking in English or have customer service advisers who speak English. It is definitely worth considering a fee based account which should not be more than €50 per year. This will provide you with a French bank account that offers Internet banking you can understand and bilingual staff which will mean that you will be able to resolve any issues that come up quickly and easily.

If you would like to open a French bank account via Athena Mortgages you will simply need to send us a few documents by scan and your French bank account can be open within 24 hours. we require:

• Signed French bank account application (copy first and then the original in the post to us)
• Passport copy
• Last two salary slips if you are employed or your last tax return if you are self-employed
• Utility bill less than 3 months old
• Marriage certificate if applicable
• Your reservation contract/title of the property in France – if applicable

If you require help with opening a bank account in France or assistance with the rest of the paperwork arising from your property in France such as tax returns, just give us a call on +44 207 471 4515 or contact us the website contact forms.

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How a 100% French Mortgage works

Got an enquiry today from Steven who wanted to know more about how 100% French mortgages works.

Steven asked, "Please explain how a 100% mortgage would work,could I buy a property with no money down in France with the a strong chance holiday lets could cover the mortgage,is there a catch,and what would be your fees."

Ignoring the obvious element that the loan amount would have to be affordable a 100% French mortgage is catch free. It does what it says on the tin, it's a 100% French home loan that can be used to purchase either an existing second home, buy to let or a French leaseback where the VAT is advanced by the developer. The only properties which are excluded are new build/off plan properties that do not have the 'residence du tourisme classification'. However, whilst 100% of the purchase price of the property is covered, the fees to purchase a property in France are not.

As a rule, it is not possible to buy a property in France without making any contribution at all, though the cash required might only run to a few thousand Euros for some French leaseback properties where the VAT is advanced. In general, for a second home or buy to let which is an existing building, there will be legal fees and taxes which will be approximately 7-8%, including stamp duty and mortgage registration tax. The bank will also charge a fee for setting up the mortgage and our broker fee will be no more the half a percent taking the total contribution to approximately €20,000 for a property worth €250,000.

We work with many developers and French agents offering French leaseback properties that have guaranteed rental income of between 4%-7%, which certainly covers the mortgage payments on an interest only basis and comes close to being self-financing with a repayment mortgage. The personal contribution required for these developments ranges from €11,000 to €20,000 for off plan properties in the region of €250k including deferred interest payments on sums drawn down to meet stage payments. If you were to go it alone and to rent out the property on a permanent or seasonal let you could probably also achieve a similar level of return meaning this would work for you also.

For a personalised simulation of the different loans available the best idea is to first find out how much you can borrow in France so just give one of us a call on +44 207 471 4515.

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French mortgage rates in 2010

Predicting interest rates and French mortgage rates is a game that can win you millions if you work in the city but at the cold hard face of decisions about which French mortgage to take out, looking at trends may save you some money.

The pound strengthened today on the back of the Mervyn King's speech last night in Edinburgh to €1.11 indicating that a rise in UK interest rates is not as a far away as was previously thought. 'I do not know for how long interest rates will remain so low but at some point they will return to more normal levels' King said 'And it would be wise to take this into account in your financial planning.'Indeed, interest rate futures in the States are pointing to a rise in U.S interest rates within a few months and generally what happens in the U.S first, soon comes to the UK and to then to Europe making the outlook for French mortgage rates higher in 2010.

So although the UK and EU each have different issues to contend with, huge budget deficit on the one hand and a currency that was not designed to replace the dollar become the world's haven of strength on the other, it is not hard to see that if the American begins to recover and heat upagain it will not be long before the UK and EU catch the fever. If you are considering investing in a French property soon, take a look at the current French mortgage rates because rates for French mortgage in 2010 may be very different.

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French Mortgage

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FRENCH PROPERTY AND MORTGAGE SUMMARY OCTOBER 2009

French property prices rise by 0.1% during September
Prices now 2.8% higher than six months ago
Number of French mortgage enquiries through Athena up 21% during Q3
French mortgage completions at Athena Mortgages up 14% Q3 on Q2

London, 19 October 2009 – Similar to the UK, the French residential property market is continuing to show signs of stabilisation. While prices* fell by 1% during Q3, they rose by 0.1% during September, resulting in a total positive return for the period April to October 2009 of 2.8%. Returns for the year to date have now pulled back to a respectable -7.8%.

Unlike the UK, however, a history of prudent lending in France (lenders do not allow borrowers’ total outgoings on finance payments to exceed one third of their total gross monthly income) has meant mortgage finance is still readily available.

While mortgage finance in the UK remains extremely difficult to secure, especially at higher LTVs, the French banks continue to lend to borrowers with smaller deposits, even up to 100% LTV. This level of LTV is also available to non-resident borrowers, both for second homes and investment properties.

The 100% mortgage, unthinkable in the UK, is proving highly attractive to investors given the ongoing weakness of Stirling.

Interest in the French property market among UK-based investors is soaring as a result. In Q3 2009, Athena Mortgages saw a 20% rise in mortgage enquiries on Q2, which in turn was up 42% on Q1. Mortgage completions in the third quarter were also up 14% on Q2. Many British property investors are now looking across the channel to add to their portfolios given the difficulty securing (competitive) finance at home.


The buy-to-let sector in France is attracting particular interest from investors at present, as depressed prices are boosting gross yields significantly in many areas. In the Normandy town of Alençon, for example, gross yields are 7.5%, while in the medieval town of Poitiers, western France, they are currently 7%. Nevers in central France boasts the highest gross yields, currently, of 7.6%. Other towns of note include Clermont Ferrand (6.8%) and Tours (6.4%).

A growing number of UK investors are also placing French leaseback properties into SIPPs, something that can be arranged through several French lenders. To this end, Athena Mortgages is currently working closely with French tax specialists, Sykes Anderson, and Liberty SIPP.

For second home buyers, now is an ideal time to buy into some of the most desirable towns and cities of France at significantly discounted prices. For example, prices in the highly sought-after destinations of Biarritz, Cannes, Perpignan and Nice are all approximately 10% lower than a year ago.

There is a degree of correlation between the UK and France, at present, in the sense that both property markets are clearly stabilising. However, while the UK property market remains very difficult for investors to access given ongoing lending constraints, there is now a real appetite to lend among the French lenders, who have suffered much less than their British counterparts. For a growing number of British property investors, France is fast proving the place to be, particularly given the availability of 100% mortgages, which circumvents the punitive exchange rate.

Crucially, there is also significant innovation at the product level. For example, we have recently launched a ‘next generation’ hybrid mortgage product in conjunction with a major French bank. With a typical rate of 3%, the new product enables borrowers to split their mortgage amount into an interest-only portion and a repayment portion, which represents a perfect balance between the potential shortfall of a capital repayment loan and the speculation of the interest-only route.

With extremely competitive borrowing rates, attractive prices and genuine product innovation, there’s a real buzz to the French mortgage market at present.

For the best second-home, leaseback, buy-to-let and equity release mortgage products, visit the Best Mortgages section of the Athena Mortgages website.

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100% French Mortgage best bet for UK buyers until 2014 -Report from Ernst and Young says pound will stay weak for four years.

A 100% French mortgage seems to be the option of sense for the next four years due to the weakness of Stirling for UK buyers of French property. The pound has lost more that a quarter of its value against the Euro in the past 2 years and as the value of Stirling continues to fluctuate, parity with the euro cannot be ruled out. So for those looking to buy French investment property of buy a dream home, what does the future hold for Stirling? According to a report by accountants Ernst and Young, the pound is likely to remain weak as international investors decline to invest in the UK in the face of the UK's growing budget deficit. This lack of investment will keep the economy slow and keep interest rates in the UK at the low rates currently being experienced.

The news is not all bad, though, in UK as a continued period of low interest rates provides an increase in the disposable income for those on variable rate mortgages. The weaker pound also offers succor to the manufacturing and tourism industries which are gradually seeing the benefits. Indeed, due to a peculiarity of the UK gilt markets for government borrowings, the situation for UK in the short to medium term seems good as the maturity for UK governments portfolio of bonds is 14 years compared to half that for other major economies. So, providing the politicians can find a sustainable way to reduce the overall deficit, investors from the UK can operate with confidence knowing that low inflation and interest rates appear to be here to stay in the short term.

The availability of finance in France for French mortgages for all property types means that the Pied a terre in Paris, Maison de charactere in the Dordogne or Chalet chaleureux in the Alps is still at your finger tips fulfil that part of your life's plan. The added benefit of course being that an asset denominated in euros is an extremely useful financial product which can be used judiciously at various stages in the financial cycle to great financial advantage. Those people who bought in France over the last decade have not only seen good capital growth in the property, but also have been able to pay off large chunks of their French mortgage when the pound was strong thus building up the equity in the property. These lucky people are now in a position to release that equity in euros and convert into pounds with an increase in the value of over 25%. These funds can then be used to pay off a UK mortgage in preparation for when the pound will become strong again. Over the course of a few economic cycles, it would be entirely possible to pay drastically reduce the overall cost of both the UK and French mortgages. In this way we can see that owning a property in France wuth a French mortgage, is not only part of dream lifestyle but also a very sensible investment as part of a balanced portfolio.

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Mortgages in France see competiton and innovation

Mortgages in France have not historically been a hot bed of innovation and competition but signs are that the French mortgage market is beginning to catch up with its cousins abroad. Recent reports from French specialists Empruntis reveal that September showed a reduction in the average rates of 0.20% for fixed rates for most durations and a reduction of 0.15% in the rates for variable mortgages indicating strong competition from French banks and French home loan specialists.

For mortgages in France for non-residents, we are seeing innovation with a next generation Hybrid mortgage product with rates typically under 3%. This Hybrid mortgage allows you to split your loan into two parts, one on an interest only basis and one on a capital and interest basis. There is a minimum loan amount of €300,000 and at least €100,000 must be on interest only. A further criteria for the loan is that the borrower must be able to show 150% of the loan amount in net assets made up from net equity, savings, stocks or shares.

The outlook for the French property market as a whole seems positive with the FNAIM, national association of estate agents reporting that the market is stable. In September, prices rose 0.1% and though prices are down over the last quarter, the overall picture is good with a rise of 2.8%. This upsurge in prices is in part responsible for the competition and innovation amongst the banks who are seeking to increase their share of the mortgage market in France. Other aspects that make up the picture are the rises on the stock exchanges, the price of gold and the slowing rise in the growth of unemployment. As has been written elsewhere, these conditions point to an excellent period for buying French property; low interest rates and still uncertainty in the property market mean there are bargains available. Access to finance is good for those that can afford it at up to 100% loan to value meaning there is not even any need to worry about the strength of the Euro. This period looks set to last for a while as Jean Claude Trichet has deemed the current rates of interest appropriate signalling that the current rates should last into 2010. While this period won't last for ever, it seems to be with us for the next 6 months at least before we may see the return of inflation and higher interest rates.

Remember that all mortgages in France require supporting documentation and are subject to an affordability calculation based on tax returns or audited accounts. For a guide to getting mortgages in France there is a handy article I wrote yesterday here. Guide to mortgages in France.

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Guide to getting a French mortgage or How much can I borrow in France?

French mortgages are somewhat different from loans/bonds/mortgages in other countries. For a start, in 95% of cases the amount you will be able to borrow from a French bank will be based on an affordability calculation that will be linked to your provable income, whereas in the UK and US it is possible to have "self cert" mortgages where no proof of income is required. In the Anglo Saxon world, with a certain amount of deposit, the future rental income from a buy to let rental property will be sufficient to obtain mortgage finance without reference to income documentation from employment or accounts. That is not to say that French banks do not consider the future rental income from buy to let or investment property, indeed, some banks will take up to 100% of the future rental income from the property into account when considering the affordability of the French mortgage loan to you.

Lets look at an example, French banks are willing to let you spend a very sustainable 33% of your gross income on servicing all your borrowings. For somebody earning the equivalent of €60,000 per year, this would mean €19,800 per year or €1650 per month. If for example, you have a mortgage of €1,000 per month, this would leave you with €650 per month to spend on a French mortgage. A quick glance at a mortgage calculator will show you that for €650 per month you could have a mortgage of approximately €100k to €200k depending on interest rates, the duration you would like to have the mortgage over and whether the mortgage is on interest only or not. If the property you were looking at had a rental income potential of 4% of its value on an annual lease basis you could realistically obtain a French mortgage of over €400,000, providing the property was valued at that amount.

There is some flexibility in the system and brokers with their personal contacts at banks can sometimes make the correct representations in order to obtain better rates and higher loan amounts. For a free quote to find out how much you could borrow in France, just give us a call on +44 207 471 4515 or visit our website. If you like to see a list of the required documentation for obtaining a french mortgage please click here. An experienced French Mortgage broker such as Athena Mortgages can save you time and money by helping you to select the right French mortgage for your project to suit your circumstances.

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Live longer and be happier with a mortgage in France

It's official, the France is now sitting pretty at the top of the league for the European quality of life index according to a study from U switch published yesterday. The report paints an idyllic picture for those citizens from the UK who can move to France where they will enjoy lower costs for life's essentials such as food and fuel, early retirement, more holiday, more sunshine, better heath care and a longer life by 2 years. Access to the more relaxed lifestyle available in France is accessible to the Brits who have the highest average salaries in Europe and many more are now enquiring about properties and mortgages in France according leading French brokers.

In August and September enquiries for mortgages in France at Athena Mortgages were up, with many enquiries for 100% mortgages. Mortgages in France are available at rates from 2.35% on a variable basis, long term fixed rates starting at 4%. The availability of credit at these rates and at this level of loan-to-value is encouraging buyers who otherwise might be put off by the strength of the euro versus most other currencies. Competition amongst French banks is also increasing, driving down bank margins. Innovation has made a come back to the market place signalled by the recent launch of a next generation hybrid mortgage which allows borrowers to split their loan amount into a portion on interest only and a portion on repayment, subject to a minimum loan of €300k.

Whilst we can't all move lock, stock and barrel across to France to endlessly enjoy the delights of good climate, shorter working hours, better doctors, cheaper petrol and more holiday, we can can perhaps purchase a property in France to sample the lifestyle when we can.

To apply for a mortgage in France, that may increase your chances of living longer and being on the whole happier, you will need to be employed or have 2 years accounts if you are self employed. To find out how much you can borrow in France just give us a call on +44 207 471 4515 and we will let you know what size mortgage you could obtain.

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Buy a French property with a 100% French Mortgage to hedge against inflation

The French mortgage market in France offers a perfect means of buying French property assets as a hedge against the impending prospect of rising inflation in the years to come. With interest rates as low as they have been since the launch of the Euro and the uncertainty in the French property market offering bargains, now is certainly the time to find out how much you can borrow in France and the French mortgages on offer to you.

It does seem as though we are nearing a change after the consumer price indices after the falls in the consumer price indices of the past two years. Gold is at an all time high and is predicted to double again to match the highs of more than $2000 per ounce in the eighties. So with impending rises in interest rates as economies take off, producing higher inflation which eats into the value of un-invested cash the time for buying assets is upon us.

French property assets are one of the most popular in the world owing to the fantastic culture, climate and cuisine. France remains the most visited country in the world with over 80 million visitors per year and Paris the most visited city. The availability of French mortgages to buy property at 100% loan to value at low rates is unique in the current financial climate and based on the prudent lending practices of the French banks.

To find about buying property in France or how much you can borrow and the required documentation you will require to obtain a French mortgage, please visit http://www.athenamortgages.com/

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WORKING TOGETHER

Athena Mortgages is a close knit, multi-lingual team with over 20 years experience in the French property market. We have helped 1000s of clients to find the best available mortgage for their French property. We work closely with many French property developers, who choose us for the clarity and simplicity of our presentation. We continue to search for the best deal for our clients right up to the day of transfer of the property.
Nick Leach of Pierre & Vacances: “ Athena Mortgages provide our clients with the optimal mortgage for the purchase, also saving our clients time and money”.
We pride ourselves on professional service and dedication to finding the best offer until the date of signature. We are happy to welcome clients at our offices in London and Paris.

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WELCOME TO ATHENA MORTGAGES BLOG

Whether you are looking to finance a holiday home, leaseback property or a buy-to-let investment in France, Athena can get you some of the best rates on the market. We negotiate hard for you because of the volume of business we do in France – and you only have to wait seconds for a decision-in-principle.

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