Athena Mortgages - French Mortgage News

Opening a bank account in France.

2012-01-27T09:28:00.000-08:00

Now opening a bank account in France can be done right from your PC. We are only need a few simple documents and you can have your French bank account open in 48hours. Many people find the process of opening a bank account in France quite daunting, especially trying to overcome the language barrier.

French Private Finance now offers this service for a small fee which comes with the following benefits.

No need to travel to France to open your French bank account

o All the process could be done online

No need to speak French

o English speaking customer service are there to help you

o Solve your issue quickly and easily

The documents for opening a bank account in France via French Private Finance are as follows:

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

You will need to be an existing or future French property owner.

If you require help or assistance from your property in France, just give us a call on +44 207 471 503 or contact us .

What is the EURIBOR anyway?

2012-01-20T03:03:00.000-08:00

The EURIBOR (Euro Interbank Offered Rate) is the main index against which French banks set their variable rate loans. For variable rate loans in the UK we generally use the Bank of England base rate plus a margin (the banks charge for lending the money). Linking rate changes to the main bank index makes it easier to judge when rates change.

By comparison, in France, variable rate mortgages are linked to an Euribor. There are Euribor rates ranging from 1 month to 1 year, the one day Euribor being the lowest and the 12 month the highest (1.2%). Most banks use the 3 month Euribor, for variable French mortgages which currently stands at 1.18% as we can see from the French market trends box. To this rate of 1.18%, French banks add their margin. The average margin is currently 2%, which if added to the 3 month Euribor today gives a variable rate of 3.18%. The Euribor is calculated as a daily average of lending rates by a sample of 57 of the most active banks in the Euro zone and broadcast at 11am im the morning. In practice, the main changes to the Euribor rates come only when the main ECB rate changes. Banks usually use the average of the last quarter when calculating and applying any changes to your rate.

It is always important to check which Euribor rate as well as the margin added to your loan and to compare likefor like as a loan with a lower margin might be based on the much higher 12 month Euribor.

Pound to reach €1.25 in 2012?

2011-12-27T12:50:00.000-08:00

Investors are tiring of the endless succession of agreements to resolve the Euroland sovereign debt crisis. Plans A through D have come and gone, either applied only selectively or trashed in toto. November's Plan D, for example, had investors "voluntarily" writing off 50% of their loans to Greece. A couple of days before Christmas the International Monetary Fund moved the goalposts. It called on bondholders to dig deeper and accept what would amount to a 65% loss. Investors had not been overjoyed about losing half their money; they were even less enthusiastic at the prospect of losing two thirds. Plan E, the latest, is a long-term project that will compel member states to observe the rules of the 20-year old Maastricht Treaty and the Stability and Growth Pact of 1997. In essence, countries that fail to keep their budget deficit below 3% of gross domestic product will be punished. How, and by whom, has yet to be decided.

There was one measure that might have turned the tables. The European Central Bank said it would make unlimited three-year loans available, at 1% interest, to every Euroland commercial bank. The first round of this Longer Term Refinancing Operation took place on 21 December. Analysts had calculated that demand could amount to €300bn. In the event, more than 500 banks lined up to borrow an average of nearly €1bn apiece. Any excitement that somebody was doing something was eclipsed by concern that so many banks needed so much money. The exercise did nothing to lower the Italian government's borrowing costs, which remain five percentage points higher than Germany's.

Neither Britain nor the United States face any comparable problem. Both are proprietors of their own currency, a position that gives them the power to adjust interest rates to suit their individual circumstances and to print as much money as they see fit. The latter ability means they need never default. For now, that gives them an advantage against the euro and both have strengthened against the single European currency by about four cents in the last month. There is every chance they will have picked up another four by the end of January.

This even should trigger an increase in interest in properties in France, check out our French mortgage best buys.

How to get the best French mortgage loan rate

2011-07-18T07:47:00.000-07:00

The recent rate increases and tightening of banking criteria were always going to come after French interest rates reached historic lows last September and we also had maximum LTVs. However, all is not lost as French mortgage finance is still available at 80% LTV for Second homes and Leasebacks at rates far more competitive than those available in the UK.

At 80% LTV you have 3.70% capped at 4.70% for the entire 20-year term or alternatively you can fix at 4.35% for 25 years. In spite of the recent rate rise on the 7^th July by the ECB, the long term index called the TEC 10 is down 0.25% from its 2011 peak, indicating a softening of the view on long-term interest rates. When you compare these French loans with the comparable UK 5-year fixed rates they are very competitive indeed. The peace of mind and security offered by these sorts of mortgage products really is an area where the UK has something to learn.

My top 5 tips for dealing with a dynamic rate and bank attitude environment such as this is to:

· Begin investigating mortgage options as early as possible in the buying process and get a decision in principle from an independent broker.
· Ensure you qualify for life assurance and find out if you will require a medical exam.
· Ensure all paperwork for the loan application is as complete as possible prior to signing a Compromise de Vente (purchase agreement)
· Once you are ready to purchase, send the completed file to an independent broker who is aware of the criteria and can place the application quickly with the right bank to match your profile.

· Sign and return all documents as quickly as possible to keep the momentum going as the longer the file is in process, the more likely criteria can change or rates increase.

French property market tightening for overseas buyers

2011-06-06T04:39:00.000-07:00

The market for French property may be set to suffer from a reduction in the amount of overseas buyers owing to a combination of economic factors. The European economy has exited recession strongly which has pushed up the price of a euro to record highs against several currencies over the past few months.

This has made it less affordable for overseas buyers of French property on two counts. Firstly the value of any deposit available to put towards the French property is less and secondly the higher value euro has decreased the amount non-residents can borrower based on the French banks income to debt ratio affordability criteria.

Which brings us to the second reason for the market tightening up, the French banks’ attitude to lending.

Many banks have decided to reduce their exposure to the real estate market and so have been tightening up their underwriting criteria when choosing which clients it wishes to lend to. Some of these changes are in anticipation of the new capital adequacy requirements and responsible lending practices of the Basle III agreement between international banks which will come into effect at the end of 2011.

The main people to suffer from the increased criteria will be those on lower incomes who will be required to show they have enough money after, their mortgage payments, to pay for living expenses according to a chart which includes the number of children in the household (fair enough). Investors who which to borrow on an interest only basis will also find the available loan durations shorter and requiring an increase in the level of net assets in cash and investment property to secure the loan. Those with very large property investment portfolios may also struggle to find a willing lender as each person’s maximum total borrowing may soon become 7 times their gross income which includes your main residence and all investment property.

Athenamortgages.com is the largest French mortgage brokerage in the UK, with offices in Dublin and Paris. Working with a network of more than 50 resident and non-resident lenders in France, Athenamortgages.com provides access to a wide range of bespoke loans and mortgages for properties in France.

French mortgage rates and tips

2011-03-24T10:02:00.000-07:00

Mortgage lending across the board through UK lenders has dried up over the past 12-24 months. This has inevitably had an impact on the ease with which British buyers can secure finance through UK banks to purchase holiday homes in France. The days when homeowners released equity from their properties to pay for that dream property in Provence are a distant memory.

Rather than using cash or remortgaging their properties in the UK to buy holiday homes in France, the French mortgage is growing in popularity. A combination of falling house prices in the UK eroding the equity that homeowners have in their properties and the UK mortgage market drying up leaving homeowners with very few remortgage options, has seen an increasing number of British buyers turning to a French mortgage as a means of financing a property purchase in France.

Also, with the Pound currently weak against the Euro, buyers can take currency fluctuations out of the equation, and potentially save thousands of pounds on the purchase, by taking out a French mortgage and holding onto the property until Sterling rallies.

For those buyers who have 15-20% deposits, French mortgages are proving particularly popular with UK buyers who can still take advantage of some of the lowest mortgage rates in French history. Although historically French lenders have had much more stringent lending criteria than the UK banks, for those borrowers who can meet these criteria, there are some exceptionally attractive fixed and variable rates on the market. It is even possible to secure 100% mortgages if the borrower has savings that amount to 30% or more of the amount they want to borrow.

It's worth noting that borrowers will have to prove they can afford the repayments on the mortgage. French mortgages work on the basis that the total of all mortgages and loans held by the borrower do not exceed one-third of their income, which means that monthly repayments on a UK mortgage will be taken into consideration when trying to fund a property purchase in France.

4 Top tips

1. Identify the area you would like to find a property in.
2. Review your financial situation with a professional French mortgage broker to find out how much you can borrow and the costs.
3. Send your broker your financial documentation and obtain a decision in principle, to be used when negotiating price with agents.
4. Finalise mortgage choice and selected a protected payment, long term capped or a fixed rate for the term.

French mortgage currency update

2011-01-07T06:54:00.000-08:00

Just as it was gearing up for roast swan and chestnut stuffing the pound suffered a setback in December. There was no single point of failure. It was the result of a combination of factors, some serious, some less so. The UK economy bore some of the blame. Some 33,000 public sector employees were laid off in a single month and none of them found new jobs in privately-owned firms. It was not what the chancellor had promised: he had promised the private sector would take up the slack. In November the public sector net borrowing requirement - the gap between tax revenues and public spending - hit a record £22.8 billion, not a clear sign that the government would be able to close the budget gap within five years. Economic growth in the third quarter of the year was downgraded from 0.8% to 0.7% at its second revision. It was not a big deal in itself but was seen as symptomatic of an intrinsically soft UK economy.

The euro has its own problems, not least the threatened downgrades of the credit ratings for government debt in Greece, Ireland, Spain and Belgium. A summit meeting of EU leaders in mid-December delivered an agreement that there should be a long-term plan to preserve financial stability but the details were sparse. Until investors see the details they will remain unconvinced. As long as they dislike the euro they will lean towards the dollar but it is difficult to tell whether they are buying it because they like it or selling the euro because they dislike it. From sterling's point of view, the euro's performance is important because Britain's economy is so closely involved with Ireland and the continent. If the euro goes down against the dollar the pound will surely follow.

The Christmas fortnight is always a dull period for financial markets. This one shows no sign of being any different. Exchange rates moved but the significance of any movements is likely to be minimal. The four cents that sterling has lost in the last month may well be important; its price action in the last ten days was always unlikely to be significant. For more news for mortgages in France please visit our website.

French mortgage rates in 2011

2010-12-21T05:20:00.000-08:00

In August 2010 the TEC 10 index, which is used to price fix long term loans in France, reached its lowest ever level at 2.53%, and in October a report published in France revealed the average rate for mortgages in France was at its lowest level since the Second World War. The average rate in October 2010 stood at 3.30% which, when you consider the average French loan term is more than 15 years, shows just how attractive rates are. The Euribor 3 month, which is the index used to price billions of Euros of variable interest rate non-resident mortgages, has risen 30% in the last 6 months and now stands at 1.030%, just above the normal pre-crisis range and margin of the benchmark European Central bank rate of 1%.

At the time of writing (December 2010) the Tec 10 has risen 20% to 3.12% since the end of August 2010, perhaps heralding the beginning of the end of these historically low interest rates. You can still get a 25-year fixed rate at 3.8% or 3.5% over 15 years at 80% of the purchase price, which in UK terms is still impressive. Tracker mortgages on the 3 month Euribor for an 80% mortgage start at 2.35% on a 25-year term. At 100% LTV you can secure a rate of 3.15% which can never increase beyond 5.15% over a 25-year period.

So where next for rates in 2011? We may see some fluctuation in the Euribor but in general any increases to mortgage rates in 2011 are likely to be small. The majority view is that we may not see the European Central Bank base rate increase until Q4 2011 and perhaps not until late 2012. Austerity measures across Europe will bite, reducing inflation and growth, meaning there is little need to raise rates. So thoughts turn to the currency element of the purchase in France. We can expect widespread austerity measures – including reductions in government spending and tax increases – implemented across Europe next year. These measures will bring about an increase in the numbers of unemployed, which is a recipe for lower growth and inflation. And with the trend for banks to be rebuilding their balance sheets with more conservative lending to businesses, and thus reducing the cash investment to get the economy moving again, we can see why interest rates, which increase when the economy is growing, are not expected to rise much in 2011.

The Pound has fallen 30% over the past three years. This is largely due to our structural deficit, which is one of the largest in Europe. The other factor is the irrational state of the market, previously, where there was too much cash chasing too few assets. This bubble also inflated Sterling to the point where what seems like a 30% drop is in fact a pretty good valuation which may be with us for some time.

The UK outlook is for low growth as our housing market is still unaffordable for many, compounded by a lack of lending from the UK banks. The Pound has recovered from near parity with the Euro in 2009 and is now hovering around the 1.20 mark, based on confidence from the market in the UK Government’s spending plans. In Europe the increasing deficit problems and lack of investor confidence in Portugal, Greece, Ireland and Spain is a worry for many. The ECB is buying bonds from these countries and is managing well to reduce the amount of money the ‘PIGS’ have to pay to borrow on the international market for the spending plans. All things being equal, we should see a stable year between this currency pair with the Pound continuing to trade around the €1.20 mark. As 60% of UK trade is with the EU, it is likely that we will fall and rise together. To keep up to date with mortgage news in France, just visit the news section on our site or register for our newsletter.

Best wishes for the festive season and New Year.

The athenamortgages.com Team

Prezi on French mortgage market trends for 2011

2010-10-27T14:11:00.000-07:00

How we help and the historic opportunity on Prezi

FRENCH FIXED RATE MORTGAGES HIT HISTORIC LOWS: ATHENAMORTGAGES.COM OFFERS 20-YEAR FIX FROM 3.45%

2010-08-25T03:45:00.000-07:00

London, August 25, 2010 – As French fixed rate mortgages hit historic lows, French mortgage specialist Athenamortgages.com launches its lowest-ever fixed rate deals, with 15-year fixed rates from 3.30%, 20-year fixed rates from 3.45%, and 25-year fixed rates from 3.60% (all at 80% LTV).

Athenamortgages.com has seen a sharp rise in the number of enquiries in August from UK buyers looking to take advantage of the cheap fixed rate deals on offer at the moment from French lenders, and September promises to be even better as fixed rates are predicted to fall even further.

The reason for these record low fixed rates has been the downward pressure on the TEC10 index, due to a combination of a low inflation environment and investors seeking the safe haven of government bonds. The TEC10 index is the benchmark index against which French fixed rate mortgages are calculated.

The TEC10 index has been steadily falling since the start of the year and has consistently been below 3% during August, reaching an all-time low of 2.60% yesterday (Tuesday, 24th August). This compares to 3.65% on 6th January 2010.

John Busby, director, Athenamortgages.com, comments: “France is in a historically low interest rate environment at the moment with average fixed rate mortgages at levels not seen since the end of 2005. At that time though the TEC10 index was well above 3%. Now with the TEC10 at 2.60% and predicted to fall even further in the coming weeks, average fixed rates could well hit record low levels in September.

“With fixed rates falling, we have seen a noticeable shift in the types of mortgages people are ringing to discuss. Fixed rates are now the overwhelming choice amongst buyers - this is not just because of the rate drop, its also because the margin between the average fixed and variable mortgage has narrowed since May, making fixed rate deals even more attractive.

“For UK investors looking for a safe, long-term investment, second home buyers or people looking to relocate to France, there has never been a better time to purchase French property. Borrowing conditions are as good as they’ve ever been, and with property prices still well below their peak, UK buyers have a great opportunity to pick up a property at rock-bottom prices and fix monthly payments for 20 plus years at fantastic rates.”

The following table gives examples of the best fixed rate deals currently available through Athenamortgages.com to UK investors looking to purchase in France:-

* For the one and five-year fixed rate deals, the rate becomes variable after the fixed rate period ends, but cannot increase by more than 1% from the initial interest rate. The rates in the table are for indicative purposes only. Rates may vary depending on the loan amount, location of the property and the profile of the client.

About TEC10

The TEC10 is the benchmark index against which French fixed rates are calculated. The index is calculated daily on long term bond yield curves and published by the French treasury.

Athena Mortgages

Athena Mortgages is the leading multilingual French mortgage broker for international buyers seeking French property finance and loans. Focusing exclusively on mortgages in France, Athena Mortgages can provide expert knowledge of the current French mortgage best buys for second homes, investment property finance, remortgage and equity release loans.

www.athenamortgages.com

Telephone London +44 (0) 207 471 4515

Euro mortgage currency watch from MoneyCorp

2010-07-28T10:24:00.000-07:00

After six months in the wilderness the euro has come back with a bang. Since early June it has added 11 cents against the US dollar, a rebound of more than 9%. For the first half of the year investors fretted about the debt problems of Greece and the possibility that contagion could affect Spain and Portugal. They didn't like the euro so they liked the dollar. Now, they worry that the US economy is running out of steam, even that the president will feel the need for yet more expensive stimulus measures. They don't like the dollar so they like the euro. It is the lesser of two evils.

The pre-and post-election rally did a good job for sterling, as did the new chancellor's brutal budget. Britain's AAA credit rating is no longer at risk and the pound is once again a currency that investors can buy without embarrassment. Many of them reduced their speculative short positions, giving the pound a post-budget boost. That does not mean they feel compelled to fill their boots with sterling. Some fear Mr Osborne's austerity plan could derail the recovery if it leads to large numbers of job losses in the public sector.

The euro's immediate future will depend on the reaction to the results of the 'stress test' imposed by the EU on 91 of Euroland's biggest banks. It has tested their capital structures to see if they could survive another financial crisis. Failure would mean the need for a capital injection. Brussels hopes the test will restore confidence in European financial institutions and revive interbank lending to normal levels. But the exercise is not without risk to the euro. If everyone passes with flying colours, will the results be credible or will the test be dismissed as a cynical piece of window-dressing?

For the latest euro mortgage rates please vist out website athenamortgages.com

Mortgages in France -Why buy French property now?

2010-06-25T03:32:00.000-07:00

Obtaining French mortgage finance for a property in France can sometimes be a daunting process as the French banks generally demand more documentation to support an application than their UK counterparts. Add the cultural and language barriers and somehow just releasing equity in the UK starts to seem like a good idea. Whilst the pound/euro exchange rate has certainly improved over the last few weeks to €1.20 to the pound in anticipation of the UK getting its finances in order, it is still 20% down on where it was a couple of years ago and in effect by paying now in pounds the price is effectively 20% higher today. Not so if you take out a euro denominated French mortgage. By keeping the finance and the purchase in the same currency the monthly mortgage payments might be higher than they would be at €1.45 to the pound but the historically low interest rates more than make up for this. The 3 month Euribor the rate upon which most variable rate mortgages in France are pegged now stands at 0.74%, + an average margin of 1.5% gives an average variable rate of 2.3%.

The whole process of getting a French mortgage can be made simple through the use of a broker. A good French mortgage broker will assess your situation and plans for your intended purchase and provide a selection of loans that will meet your criteria. At athenamortgages.com, we generally layout all the purchase costs and mortgage payments in a time line so as to provide a clear comparison between the different loans available. These comparative simulations are made after a consultation with the prospective borrower comparing up to 3 different products side by side. Currently we can offer up to 100% of the property price for a second home or investment property in France which means the exchange rate concerns are minimized with only the 8% stamp duty and taxes to pay. This loan will typically be on a repayment basis over 25 years at a rate of 3.8% capped at 4.8%. Loans with a fixed rate of 4.3% for 25 years are also available at 90% of the purchase price.

There are many good reasons why buying French property now is a good idea. For more information on the current best rates for mortgages in France please visit our best buy tables found at www.athenamortgages.com

The effect of the UK budget on the French property and mortgage market

2010-06-22T06:06:00.000-07:00

George Osborne’s budget today outlined some major changes to UK taxation but what effect if any will this have on the market for French property from UK buyers? The headline changes from the speech are the rises in VAT to 20% and the increase in capital gains tax to 28%. At first glance both of this rises appear to reduce the attractiveness of making investments as cash flow is effected by the rise in VAT and the long term profit of owning a second property in France is reduced by the increase in CGT.

Listening to Harriet Harman’s appraisal of the budget as being unfair on those with the lowest incomes, as proportionally speaking the increase in VAT will hit there hardest, we can glean that it some way this budget is beneficial to those on higher incomes. In many ways this is right, the effect of the intended reduction of the deficit over the term of this parliament will be of benefit to those on higher incomes, as in fact it will eventually be for everyone. With regard to the French property market, usually the preserve of those on higher incomes who are least affected proportionally by the increase to VAT, the effect of a Britain living within its means will be a stronger pound, and therefore lower costs for mortgage payments, whether the payments are regular or lump sum.

The rise in CGT may deter some UK based buyers to the French property market, these same buyers being deterred in fact from almost any form of investment, if they are overly price sensitive. Just a few years ago the rate for CGT stood at 40% (with some additional taper relief benefits) so in fact the rise could have been larger but seems to have been optimised in terms of ensuring the balance of payments to the treasury increases. As the majority of investors in France look for the long term, I do not believe the rise in CGT will have much of a noticeable effect. In fact I believe that the certainty brought about by the budget will in fact allow more people to make decisions which had been delayed pending the budget.

Overall the picture looks good for the UK and the outlook for continued excellent conditions for buying French property with mortgages in France.

Fixed rate mortgages in France vs UK.

2010-06-11T05:50:00.000-07:00

Mortgage interest rates in France and across Europe are at an historic low currently which means that mortgage interest rates can only really go in one direction now. Whilst borrowers in the UK languish under the implied threat of interest rate rises owing to an UK inflation rate that is at the highest point since August 2008, the majority of their French counterparts can continue unconcerned thanks to their fixed rate mortgage in France which has a fixed rate for the term. Indeed, 70%-80% of current French mortgage holders have long term fixed rates of 15-25 years and with variable rates generally being capped and monthly payments on variable mortgages generally not allowed to increase by more than 10% per year, it is easy to see why the French are relaxed. By comparison, British borrowers live under the sword of Damocles as the majority, 70%-80% have fixed rates which are not longer than 5 years which means that there is always a chance of coming off a fixed rate into an environment of higher rates and thus substantially higher mortgage payments.

In France, the general trend is to have one mortgage to pay for a property rather than remortgaging every few years as borrowers do in the UK. The level of demand drives for fixed rate mortgages in France drives exceptionally good value deals not see in the UK. For example, at the time of writing, a French resident might fix for 25 years at a rate of 3.76%. “But that must be for a low level of loan to value!” I hear you cry. In fact this rate can be procured for 100% loan to value which makes the 5 year fix, currently available from the Co-op at 3.99% at only 75% loan to value, seem wildly overpriced. Even non residents can access a fixed rate mortgage in France with a better rate than that. Delving into the reasons for this price disparity, there are technical reasons relating to the UK banks purchases of covered bonds according to the Miles review commissioned by Gordon Brown but the main cause is the extreme price sensitivity of UK house buyers, looking at short term gain rather than long term value.

UK and Internationals buyers of French property can benefit from fixed rate mortgages in France with 4.3% fixed over 25 years at 90% loan to value being one of the most attractive deals. Unfortunately, French banks do not take charges on UK property, otherwise I am sure many borrowers in the UK would be looking to fix for the long term.

Interest rate and exchange rate outlook from Moneycorp

2010-05-28T01:38:00.000-07:00

One of the first letters received by Britain's new chancellor came from Mervyn King, governor of the Bank of England and guardian of the nation's 2% inflation target. The governor must write an open letter of explanation and intent if inflation strays beyond a range of 1% - 3%. In April it was 3.7% so he put pen to paper. Two years ago or more the solution would have been simple; raise interest rates to dampen demand and bring inflation back into line. In the modern post-financial-crisis world with political uncertainty at home, fiscal anarchy across the Channel and low levels of economic growth in developed countries the decision looks less straightforward, especially as the Bank sees this inflation upturn as only a temporary blip.

Although inflationary pressures in Euroland are less severe - 1.5% in the year to April as opposed to Britain's 3.7% - the legacy of the hardline pre-euro Bundesbank is to make its ideological successor, the European Central Bank, especially intolerant of rising prices. In its 11-year history the ECB has been tough on inflation, tough on expectations of inflation. It was two months after the Bank of England's policy rate bottomed at 0.5% in March last year that the ECB reached its own low point at 1.0%. And while the Bank of England was spending £200 billion buying up UK government bonds last year in order to relax monetary policy with 'quantitative easing', the ECB shied away from anything that smacked of printing money.

During the early part of this year the sensation was that, with the recession behind them and economic growth on the rebound, both the BoE and the ECB were girding their loins in preparation for bringing interest rates back up to what they consider normal levels. Europe's response to the Greek debt crisis is changing that perception. After half a dozen false starts the EU put together in May a monster €750 billion rescue plan not just for Greece but for any other country that might find itself in the same position (think Portugal, Spain, Italy). The ECB has had to soak up Greek government bonds that nobody else wants. Governments in Ireland, Italy, Spain, Portugal and, of course, Greece have imposed austerity measures involving public spending and wage cuts as well as higher (or at least better-enforced) taxes.

There can be no doubt that the severity of the measures will have a depressing effect on the economies of the countries directly involved. But it will also affect countries with whom they do (or did do) business. That means not just their neighbours in Europe but the emerging markets and commodity-producers that supply them with zinc, rubber, motorbikes and flat screen TVs. The global recovery is suddenly no longer inevitable: the risk is of a return to global recession. What worries investors now is the possibility of Global Financial Crisis II: This time it's personal.

As long as that concern persists it is unlikely that central banks in Europe - or anywhere else - will rush to tighten the screw with higher interest rates, especially as banks in the private sector are already doing that. For example, it is a matter of supreme indifference to UK consumers whether base rates are 0.5% or 1.5% when they are paying an average of 15% to service their overdraft.

Because of this it is probably fair to expect official interest rates in Britain and Euroland to remain at their current low levels into next year. There are risks to the scenario, not least the danger that inflation could re-emerge in Euroland or refuse to subside in Britain. But with half the continent held down by austerity budgets and reduced incomes it is not easy to see what might possess manufacturers and retailers to bump up their prices.

With steady-as-you-go for interest rates and no horrible economic or political surprises there would be reason to think the sterling/euro exchange rate could remain within the €1.09 - €1.19 range that it has occupied for six months. But horrible surprises have become the rule rather than the exception lately and there is no reason to suppose the show's over. If another Club Med country joins Greece in the queue for handouts the euro will suffer. If Britain's untested coalition government fumbles the task of sorting out the deficit the pound will have to take it on the chin. To paraphrase the opening line of the 1960s kids' series 'Stingray'; 'Anything can happen in the next half year!

French mortgage interest rates, look set to stay put where they are for the time being. For more information on the current best deals please call Athena Mortgages on +44207 471 4513.

Rates for French remortgages and French equity release mortgage rates

2010-05-21T10:46:00.000-07:00

Remortgaging or releasing equity from your property in France can be an interesting as the process is quite unusual. There are a variety of reasons why refinancing an existing mortgage in France is not a common occurrence and subject to different rules and procedures from those in the UK. One reason is the existence of mortgage registration tax in France of approximately 1.5% when you bought your property. Every time the notary registers a charge against a property there are some transaction fees and taxes, which in the case of a French remortgage are called ‘frais de main levée’, literally cost to take the hand off, and then some fees to register the new mortgage amount for the new bank. Overall the fees for remortgaging your French property will be in the region of 2.5%, which depending on the current rate you are paying on your mortgage may be attractive.

Given the popularity of fixed rate mortgages in France, most people fixing for 20-25 years, it is easy to see why the market to remortgage properties in France is not that active, as most people are comfortable with the rate they have chosen. In addition, almost all fixed rate mortgages in France have an exit penalty of up to 3% or 6 months interest (half the interest rate on the mortgage) making the overall cost of the remortgage up to 5% for those on a fixed rate. Overall we can see that the cost of remortgaging may make the savings on the monthly payment not all that worthwhile for those on a fixed rate whilst those on variable rates can breathe more easily as there are generally no exit penalties or early repayment penalties on variable rate mortgages in France.

For those seeking to refinance a loan in France or to remortgage a ‘capital and interest’ loan, switching to interest only, the outlook currently is not favourable. Only those borrowers with the best profiles will be able to succeed in convincing a bank of the need to do this. The news coming out of most French banks is that such requests will be refused as lending policy seems to have changed against offering interest only loans for all types of mortgages in France not just French remortgages.

On the brighter side, those with large amounts of equity in their property in France or those who bought their property 7-10 years ago may find that with rates so low it may well be worth incurring the costs of remortgaging or releasing equity in France. The euro remains fairly strong against many currencies, though not the Aussie or US dollars, and so the benefits of transferring a large amount of equity home to places like the UK may well make sense at today’s exchange rate. For anyone with a rate over 6% it also makes sense to seek a French remortgage as you can certainly make the money you outlay in just a few years.

In terms of the documentation required to remortgage, you will have to provide proof of income, identity and your last three months bank statements together with the deeds of the property and the original mortgage offer. If you would like further information on French remortgages or equity release to see the current best rates for remortgages and equity release mortgages in France just pay us a visit or call us on +44207 471 4513.

French mortgage rates 2010-2011: What next?

2010-05-14T11:24:00.000-07:00

French mortgage rates have been relatively stable now for over a year. The only changes in the overall rates coming from changes in bank margins or if banks change their initial rate, also known as a teaser rate. So with all the turmoil in France over the huge deficit in Greece, what is the outlook for rates for mortgages in France?

French mortgage rates are based on the rate set by the European central bank which currently stands at 1%. As the EU only has one interest rate for all 16 member states, it cannot adjust the rate to help those countries that are worse off. So when considering which way the rates for mortgages in France will go, we have to look at what is happening across the EU.

The main factor affecting the ECB rate from which we get the current French mortgage rates, is the situation in Greece and the wider social problems of unemployment and rising household debt. Although the markets responded well initially to the One Trillion Euro bailout plan agreed by EU finance ministers, it was French president Nicholas Sarkozy apparently threatened to take France our of the Euro if the deal was not agreed, there is still some doubt over Greece’s ability to push through the austerity measures necessary to reduce their growing deficit and to reduce the interest rate payable on their Government bonds. The fact that some of the guarantee is coming from Portugal, Italy and Spain, who may also have problems reducing their own deficits, means there is some cause for concern, as their economies are not out of the woods yet. All this brings the Euro to an 18 month low against the Dollar today as concern spreads about the prospects for economic recovery. With the inflation rate predicted to stay low throughout 2010 and 2011, kept in check by a rising French unemployment rates, a pattern replicated the rest of Europe, the prospects for any large increases in the ECB main refinancing rate, and thus the interest rates for French mortgages, seem small for the next 18 months at least.

For a view of the current best buys and French mortgage rates please vist our website.

French Mortgage calculator

2010-05-04T01:41:00.000-07:00

Using a French mortgage calculator can give you a good understanding upfront of the likely cost of your mortgage in France. One question I have whenever am looking at calculators for mortgages in other countries is what is the likely rate going to be and what percentage of the property price am I going to be able to borrow. This is why on our French mortgage calculator page offers a handy idea of what the French mortgage best buys are for a range of purchase options from a classic second home mortgage to French leasebacks and Equity release options. With this information it is easier to get a top level understanding of what the likely loan payments will be on the mortgage and can help to inform you in your search for the right property and the right finance.

However, French mortgage calculators, like all mortgage calculators are offering figures in a vacuum and it is always necessary to find out if you will be able to qualify for the loan amount you would like to borrow. In order to calculate what size French mortgage you would be able to borrow, French banks apply an affordability calculation. This is based on your gross salary, you out goings for existing loan payments and any existing rental income. Take a calculator, calculate your gross annual salary on a monthly basis and then multiply this figure by .33. This will give you the amount the French banks consider you have available to spend on borrowings and loan payments on a monthly basis. From this figure you should deduct all you current monthly outgoings for loan payments and then ad 80% of any existing or future rental income you may get (N.B. French banks do not take seasonal income from holiday lets into consideration in their calculations. If you are planning to buy a property and to rent it out on an ad hoc basis, please get in touch with one of our consultants who may be able to get some of this income taken into account).

You should now have a figure which will be a good approximation of how much the French bank calculates you have to spend on a monthly payment for a French mortgage. The best way to confirm you situation is of course to speak with a professional broker who understands all the different ways French banks calculate the affordability ratio and how to get the best loan for you. Athena Mortgages are a specialist French mortgage broker and so we can offer you a fast decision in principle, telling you not only how much you can borrow in France but also send you a bespoke simulation comparing up to three mortgages side by side at a time, detailing purchase timelines, the dates when each sum will be required and also the documents required to apply for each loan. An overview of the current best French mortgages rates and our French mortgage calculator is available on our site and our consultants are available on +44 207 471 4515.

French mortgage rates

2010-04-30T03:23:00.000-07:00

When looking on the internet for the latest French mortgage rates, there are many sites offering this service. The temptation for most sites is to only give the lowest rates, perhaps for short durations such as fifteen years, which look attractive on the page, but leave some people disappointed when the realization hits that in fact the rate for the duration they are looking for is in fact much higher. In fairness to many of these sites the average cost per month for a €100,000 or €250,000 mortgage is also often displayed. However, many French banks still operate with an very low initial rate designed to attract customers, which distorts the figures for comparison and also the amount of the monthly payment. This initial rate or ‘taux initiale’ is usually fixed for 3 months, reverting afterwards to the 3 month Euribor + a margin. So when comparing the current rates for French mortgages, it is important compare the index the rates is based on and the subsequent margin after the initial period.

The French mortgage rates found on the best buy comparison tables on our website provide this information to the prospective borrower upfront, in order that all the information is provided clearly for the comparison to take place. There is also a handy French mortgage calculator which allows you to calculate the amount you would pay per month for each different mortgage. Unlike many other sites, there are French mortgage rates for French leaseback mortgages, French second home mortgages, French buy to let and French equity release loans to be found on our website. In addition, you can find comment on the likely next movements for mortgage rates in France to help you to

Now all this is very useful when research which broker can offer you the current best French mortgage rates for mortgages in France but are there any brokers that offer a personalised comparison document? The answer is yes, and you guessed it….Athena mortgages are the ones providing this level of comparison on a regular basis. On most of our simulations, we will compare up to 3 mortgages in addition to outlining the purchase timeline and the amounts you will need to have ready at each stage of your purchase in France. So if you would like to receive a bespoke financial simulation, comparing three suitable mortgages, just call us on +44 207 471 4515 in London or visit click to visit our French mortgage comparison table page for the latest French mortgage rates.

Life assurance for French mortgages set to change

2010-03-22T15:07:00.000-07:00

The French mortgage market has received many plaudits recently as it is in relatively good shape compared to its ailing Anglo Saxon cousin. Once you look on the inside of the institutions and procedures of many of the banks you might be forgiven for thinking that you had been transported back to the mid 1980s. In recent times, competition has increased for mortgages in France for international buyers and in the past couple of years the first mass market interest only loans were introduced. Now further reform is on the cards as the French economic and finance minister, Christine Lagarde, continues her improvements to the regulatory landscape especially hidden bank charges.

Many international buyers of French property are surprised to find that life assurance is compulsory for all French mortgages. Even more surprising, is that the majority of French banks only allow applicants to use the life assurance recommended by the bank. However, this seems set to change with the Lagarde Reform which is currently going through the French legislative process. The main provision of this project lies in Article 17 which amends Article L. 312-9 of the Consumer Code as follows: "A lender may not refuse to secure another loan insurance contract when the contract has a level of security equivalent to the insurance contract that offers". Other amendments are also being proposed to strengthen consumer rights in this regard and the changes are expected to come into force on the 12th May 2010. This shake up should bring in more competition which is long overdue within the market.

The benefits of this reform will produce real cost savings over the life of the mortgage, with some insurance brokers saying that insurances costs pay go down by over 50 per cent. The minimum typical type of life assurance required for a mortgage in France is against death or total loss of mobility which generally costs €30 per month per €100,000 borrowed which for an average sized loan over 15 years would save over €5000. For more information or to sign up to our newsletter please visit www.athenamortgages.com

French mortgage rates on the rise despite ECB hold

2010-02-04T15:44:00.000-08:00

After meeting today with two of France’s leading mortgage providers, Athena Mortgages is now aware that the average margins for French tracker rates are about to increase slightly, whilst fixed rates in France are also about to rise. This increase of approximately 7% does have an impact on the bottom line for investment properties such as new build ski leasebacks as well as for classic second home properties. As we have some influence with our partner banks owing to the fact that so we have provided half of their total volume for the year, we have secured some preferential conditions and packages. These exclusive French mortgage deals will delay the rises for our clients for a period of 2 months and so we recommend you contact us very soon if you are considering a mortgage in France for an investment property.

These increases in the average french bank margins takes place against the back drop of the latest hold for the European Central Bank base rate which remains at 1%, which should have meant stability in the rates. However, the debt problems in Greece and the long term implications of the necessary cuts and the financial support which may have to be offered by the EU to Greece means that international investors have sold positions in Euros preferring to buy US dollars. This has weakened the Euro by 1% against the dollar which is now at a 7 month high against a basket of currencies. The effects of the weaker Euro could be beneficial in the longer term as exports will pick up again, creating more jobs but in the shorter term it makes a European foreign currency bank debt more expensive, which could be reason for the increase in bank margins.

Before Christmas I wrote on this blog that I thought we would see increased competition among the French banks for French mortgages and that I anticipated a reduction in the margins from the major lenders looking to secure the good quality borrowers in this market ( I now think this will happen in early 2011). However, the pressure on the Euro economy, especially countries like Greece, Spain and Ireland who have major cuts to make in spending is reducing the demand and price for oil which therefore makes the medium outlook for sustained inflation above 2% unlikely. In this situation some of the major banks seem to be looking to raise their margins again to compensate for the fact that central bank interest rate rises may be further away than we think and so opting to increase their balance sheets with higher margins with which they may be able to offer higher interest rates to savers thus attracting more capital.

This trend for higher increases is putting pressure on many investors who are looking to lock in the lower rates and other investment advantages while they can before many of the increases and changes take place in mid April. So if you are looking new build properties or a French leaseback property mortgage it would certainly be wise to call us and to take advantage of some of the conditions we have negotiated which include rates from 2.4% with 3 years of interest only possible.

On our website, you can find some of our best French mortgage rates with best buy tables and a French mortgage calculator but there is nothing better than giving us a call especially if you have a project in mind which is completing this year.

Athena Mortgages London +44 (0) 207 471 4515 Athena Mortgages Paris +33 (0) 1 53 63 12 72

The worst day of the year is behind us...

2010-01-25T17:09:00.000-08:00

It is widely accepted that the last Monday in January is when most of us feel at an all time low for the year as memories of Christmas fade, the gloom gets to us (if we are in the northern hemisphere) and anxiety and depression can set in for all sorts of reasons not least the fact that New Years’ resolutions have already been broken. However, from our perspective, here at Athena Mortgages, all in fact seems to be brightening up and we are looking forward to another excellent year.

The general feeling from many of our partners seems to be positive with many having closed many sales of French property over the festive period and continued the habit into the New Year. Across the board there seems to be a feeling of cautious optimism for the coming year with many plans now starting to bear fruit. The new organization of Athena Mortgages is now almost complete, after careful analysis we are now confident that our new processes will allow us to offer even better customer service by improving our response times in all areas of the French mortgage process in spite of the rising number of enquiries.

There is no bad news from the French mortgage market to report, rates are still on hold and seem likely to stay that way. Average property prices in France recorded a small drop in December which will keep vendors on their toes maintaining the good buying conditions across France. As always you can find the most up to date rates for mortgages in France on our website. Our new look website boasts a French mortgage calculator and interactive best buys table for second home, leaseback, buy to let, equity release and refinancing mortgages in France.

Poll predicts no rise in ECB rates until Q4

2010-01-05T15:33:00.000-08:00

The view that interest rates for mortgages in France will remain low for the next year at least, continues to be borne out as a recent poll by Reuters of 80 economists has predicted that there will be no increase in the European Central Bank interest rates until the fourth quarter of 2010. With this news, the outlook for rates for financing in France remains good with rates generally predicted to only rise to 2% in 2011. As we step out of the shadows of 2009 and into the uncertain light of 2010, there is a great opportunity for those with the confidence to search out and negotiate price reductions for the bargain property currently available in France. So if you have been planning to buy a property in France or you are looking for a good long term investment, The borrowing conditions have not been this good for a generation.

Our view of the market shows us many types of property in France selling well, with a particular seasonal interest in Alpine locations and good investment deals with little money down and more or less cash flow positive under the French leaseback scheme. We have continued to receive a steady flow of interested clients looking for the best rates for acquisition and equity release mortgages alike over the festive period and into the New Year. So far, only one of the French banks has show its hand with regard to their rates for January and this so far has been for a small raise. Overall, the market for French property is starting to get going as some confidence returns; the France Show at Earls Court, London, this weekend should provide a good indication of just how confident the largest population of non-resident buyers of French property, the English, are becoming.

For a view of the current French mortgage rates available, please visit our recently re-launched website which focuses exclusively on mortgages in France.

Happy New Year from all the team at Athena Mortgages

10 year low for EU Central Bank rates

2009-12-03T13:57:00.000-08:00

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.

EU inflation and French mortgages

2009-12-01T04:17:00.000-08:00

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.

Outlook good for low mortgage rates in France

2009-11-11T13:06:00.000-08:00

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.

French mortgage best buys for mortgages in France

2009-11-09T15:00:00.000-08:00

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.

ECB keeps rates on hold at 1%

2009-11-05T14:52:00.000-08:00

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.

Why buy French property now?

2009-11-04T13:19:00.000-08:00

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 ©

French mortgage comparison tables: Things to look out for.

2009-11-03T14:40:00.000-08:00

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.

French equity release mortgages in France gaining in popularity

2009-11-02T14:16:00.000-08:00

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 ©

Eurozone expected to exit recession on Nov 13

2009-10-29T14:53:00.000-07:00

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.

French home loans: Finance for US buyers of French property

2009-10-27T13:36:00.000-07:00

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

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

2009-10-26T14:02:00.000-07:00

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.

Latest rates for fixed and variable rate mortgages in France decrease

2009-10-24T09:20:00.000-07:00

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%.

Fast French bank account opening at distance

2009-10-23T12:53:00.000-07:00

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.

How a 100% French Mortgage works

2009-10-22T13:16:00.000-07:00

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.

French mortgage rates in 2010

2009-10-21T14:16:00.000-07:00

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.

French Mortgage

2009-10-20T09:40:00.000-07:00

FRENCH PROPERTY AND MORTGAGE SUMMARY OCTOBER 2009

2009-10-19T03:02:00.000-07:00

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.

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

2009-10-17T14:54:00.000-07:00

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.

Mortgages in France see competiton and innovation

2009-10-16T12:13:00.000-07:00

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.

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

2009-10-15T14:53:00.000-07:00

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.

Live longer and be happier with a mortgage in France

2009-10-14T13:26:00.000-07:00

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.

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

2009-10-13T07:43:00.000-07:00

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/

WORKING TOGETHER

2009-06-05T03:16:00.000-07:00

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.

WELCOME TO ATHENA MORTGAGES BLOG

2009-06-04T09:23:00.000-07:00

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.