Here are a few simple tips to get the best mortgage deal in France. The following recommendations particularly apply to international buyers who can have access to a wide range of mortgage products when buying or refinancing in France.
1. If you can afford the monthly repayments, select a shorter duration for your mortgage contract. In France, the shorter the duration, the lower the mortgage rate.
2. Always factor the cost of the life insurance premium. Lenders will not advance euro denominated mortgages unless a life insurance has been assigned to them. Mortgage insurance is an important cost component of a French mortgage and can represent as much as 25% of the borrowing cost. So make sure to include the life insurance element and don’t simply focus on mortgage rates.
3. Do not go straight to specialist lenders catering for international buyers. They deliver a good service but it can come at a premium cost. Shop around and compare.
4. Negotiate ! In France, fees and mortgage rates are not always set in stone. Bargaining is common place so make sure to challenge the lender. If you are not comfortable pushing back, get a broker to do the negotiating on your behalf.
5. It’s location, location, location but not rates, rates. To get the best mortgage deal, always include fees (completion fee, early redemption fee) and the cost of the guarantee that the lender will require. Fixed fees can make a big difference to the overall cost of a French mortgage.
6. If you want to have access to the whole of the French mortgage market, use an authorised French broker. Make sure that the mortgage broker is regulated to arrange mortgage contracts in France and make sure that the broker can also arrange life insurance contracts. A French mortgage broker has a best advice duty and cannot charge fees before completion.