French mortgage interest rates remain low and some banks are reducing them further, say experts

French mortgage lenders are maintaining interest rates at a low level. This trend is likely to continue throughout the summer of 2014.

During June, interest rates were at a historically low level, with banks discounting their mortgage rates in a very competitive climate. The European Central Bank (ECB) cut its interest rate from 0.25% to 0.15% in early June, in a move to boost the Eurozone economy.

French mortgage rates for a 20 year fixed rate mortgage dropped from 3.75% at the beginning of the year to 3.45% in June. This tendency looks set to continue over the summer, according to experts, but is expected to slow down a little in July.

In July, some banks have been offering even lower rates, below 3% in some cases for a 20 year fixed-rate loan. This is the rate offered to property buyers presenting the ideal profile: those who have a deposit of 20% and a stable, high income.

Lack of inflationary pressure and a slow economic recovery are holding down interest rates for the moment in the Eurozone. Analysts predict that they may start to rise again during the fourth quarter of 2014 or early in 2015, following possible increases by the Fed in the U.S. and the Bank of England in the U.K. In the meantime, French banks are actively targeting borrowers with a good profile.

For the latest French mortgage rates, you can view International Private Finance’s best buy tables. To see how much your monthly French mortgage payments would be for a given loan, see our French mortgage calculator.