» French mortgage

September French Mortgage Update

Aurelie — Fri, 27 Aug 2010 15:50:02 +0000

With doubts regarding the economic growth, the European Central Bank (ECB) should not modify its key interest rate, at the record low level of 1%, before the next year. By consequence, Interest rates in September remain unchanged compared to July 2010. They are still lower compared to January 2010 with the Euribor 3 months rate at 0.888% so it is the still a good time to take on a fixed rate, at their lowest value ever.
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French interest rates and how they work
Most of the French Mortgage lenders index their rates to the Euro Interbank Offered Rate, or Euribor, the average interest rate at which term deposits are offered between prime banks in the EU wholesale money market or interbank market. Just like the LIBOR serves as a short-term reference rate for British Pound and U.S. Dollar, the Euribor is widely used as a reference rate for Euro.
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The French banks usually index their rates to Euribor 3 months currently at 0.888%. Each bank applies a margin of between 1.30% to 2.50% depending on the lender and the product’s features.
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Variable products are usually redemption penalty free, although some banks may charge penalties in case of a re-mortgage. Fixed products are currently very low and very popular, but capped products starting at 3.50% and capped at 4.50% are also recommended in the current climate.
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Best French Mortgage products currently on the market

1. Interest only mortgages with variable rates starting from 3.15%
2. Rates starting from 2.20% for equity release and re-mortgage
3. Rates fixed for the entire term starting from 3.15%*
4. Some French products are capped at 1% above the initial rate, to give you more security
5. 100% LTV French mortgages with capped rates starting from 3.50%** .

Rate type	Interest rate***	Maximum LTV	Monthly repayment for €100,000 over 15 years
Variable Interest Only	3.15%	80%	€262
Variable Repayment	2.20%	80%	€652
Fixed Interest Only	2.95%	65%	€246
Fixed Repayment	2.85%	80%	€546
Capped Repayment	3.50% capped at 4.50%	100%	€715

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* Over a short term of 6 years on a repayment basis, for a loan of or above €230,000

** You would only be expected to pay the Notaire fees and the estate agent’s fees. Available only for properties of over €300,000

*** Higher rates may be applicable for longer terms and different loan amounts

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For more details regarding French mortgages, you can have a look at our website dedicated to French mortgages: http://www.sextantmortgages.com
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If you would like to receive a free quote with no obligation, contact our in-house mortgage consultants by telephone: 0207 428 4918 or by email: mortgages@sextantproperties.com
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Invest in a holiday home in the beautiful Languedoc area

Aurelie — Fri, 27 Aug 2010 11:39:22 +0000

With 15 million tourists each year, the Languedoc Roussillon is a beautiful region of southern France. A few years ago, only the Cote d’Azur was prized by buyers and tourists. However, this trend is changing and moving to the Languedoc area, which is well appreciated by workers and retired people alike. Situated between Spain and Provence, The Languedoc Roussillon is split in five departments: Aude, Gard, Herault, Lozere and Pyrenees Orientales.
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Located on the crossroads leading to Italy and Spain, the Languedoc Roussillon has a rich heritage with outstanding places such as Saint-Jacques de Compostelle, the Canal du Midi or the Via Domitia built in 118 BC. The antique monument known as the Pont du Gard or “Gard Bridge” is the most visited in France and the best preserved aqueduct in the world. Added to the Unesco’s list World Heritage sites in 1985, the bridge was built by the Romans in the middle of the first century AD. It was a part of 50 km of piping bringing water from the Eure source to the city of Nimes. Outstanding and impressive, the Pont du Gard offers three levels with 52 arches and attests to the domination of the Roman Empire in the Mediterranean.
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The oldest European canal, the Canal du Midi was a river project linking the Mediterranean Sea to the Atlantic Ocean. Understanding the major economical, political and military interests, Louis XIV ordered its construction in 1666. During fourteen years, 10,000 workers built 328 structures of bridges, aqueducts, ponds and locks. For over two centuries, this outstanding achievement contributed to the economic growth of the region, rapidly threatened by the creation of the railway. The trade activity disappeared in the seventies. The Canal du Midi now serves the tourism industry, which is constantly growing.
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The Regional committee of Tourism has imagined various ways of discovering these beautiful places by walking or biking. Two years ago, the committee decided to create a quality label for the Languedoc Roussillon. In partnership with the French state, the department committee of Tourism, the Chamber of commerce and others, the South of France Quality (“Label Qualité sud de France) label has been created.
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Integrated in a project linking Spain, France and Italy, the Mediterranean South Europe LGV (high speed railway) will be a great achievement by linking these beautiful places. Due in 2015-2020, this accomplishment will definitely revitalize the area. Languedoc Roussillon is also well served in term of airports as there are five main commercial airports- in Beziers, Carcassonne, Montpellier, Nimes and Perpignan. At the end of the building of the Mediterranean South Europe LGV, Paris will be easily linked to Madrid via Barcelona. Consequently, this large European axis will be of huge benefit for the whole continent. Montpellier will be only 3 hours away from Paris. (Currently Marseille is also 3 hours away from Paris). But one of the major objectives of this project is a strong development of rail freight in order to decongest the French motorway network, mainly along the Rhone Valley. Moreover, the travel times between French and Spanish cities will be reduced by half. The future TGV will serve eight cities in Catalonia and south of France: Barcelone, Béziers, Figueras, Gérone, Montpellier, Narbonne, Perpignan, and Toulouse.
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The evolution of the Languedoc Roussillon’s coastline is linked to the renovation of the area. In the sixties, the French government created major regional development projects involving tourism and equipments. Legislations have been introduced to assist in the respect of the coastline and the mountain. The coastline offers amazing resorts with beautiful sandy beaches and marinas in Port-Camargue, La Grande Motte, Gruissan, Saint Cyprien or Port Barcares rewarded by the Blue Flag – the award given to beaches and marinas regarding the environment (“pavillon Bleu”). Some of them offer traditional fishing ports like in Sete or Collioure where it is possible to buy fish and shellfish directly when the boats came back from fishing in the morning. Also, with 30,000 mooring rings and 27 marinas, the Languedoc Roussillon opens on the Mediterranean Sea, Europe and Africa.
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The Languedoc Roussillon area benefits from numerous tourist attractions thanks to an important cultural and historical heritage. Between the Pic Saint Loup – one of the most beautiful natural areas of the Herault department – and the north of Montpellier, villages such as Saint-Clement de Riviere, Mas de Londres or Montferrier sur Lez have known a demographic boom in the last twenty years. Lots of houses have been built for the inhabitants of Montpellier who were looking for green and quiet areas. Beautiful houses are located in the plain, in the scrubland or on top of wooded hills with pine forests and holm oaks. With 300 Sunny days per year, the Languedoc Roussillon area is now one of the most popular areas of France as it is the fourth touristic area in the country. Since the end of 2009, the real estate transactions have grown with an average price between 180K€ and 230k€ for a house of 100 sq mtrs. Currently, property prices are a third of the price of Provence.
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So if you are looking for a holiday home in France, why don’t you take advantage of the Languedoc Roussillon area? A budget of €240,000 will buy you a charming one bedroom apartment with a swimming pool and an exceptional view over the harbour in the surroundings of the Cap d’Agde. If you are looking for a typical village house in the heights of Beziers, you will certainly enjoy this fully renovated stone house. With beautiful views on the countryside, the house will be yours for €108,900. If you are looking for a Mediterranean style, a budget of €415,000 will buy you this villa with stunning views on the Pyrennees. Following the Languedoc coastline, Pezenas is a small and pretty medieval town where you can find a great French leaseback opportunity with Les Templiers resort consisting of luxury apartments from studio to two bedroom apartments with Mediterranean gardens, spa and swimming pool.
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Sextant properties also offers original properties in the Languedoc Roussillon such as an amazing 12^th and 16th century property near Bedarieux for €795,000. Located only 40 minutes away from Beziers, this magnificent castle comes with two swimming pools, two Jacuzzis, two apartments and plenty of convertible space with huge potential. Also outstanding, this 18th century manor house set in 18 acres with numerous outbuildings and gites is situated near Carcassonne for €1,100,000.
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But don’t worry; there are plenty of properties on Sextant Properties website in the Languedoc Roussillon area. Don’t hesitate to contact one of our agents to discover our beautiful properties.
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August French Mortgage Update

Aurelie — Wed, 04 Aug 2010 08:59:36 +0000

With doubts regarding the economic growth, the European Central Bank (ECB) should not modify its key interest rate, at the record low level of 1%, before the next year. By consequence, Interest rates in August remain unchanged compared to July 2010. They are still lower compared to January 2010 with the Euribor 3 months rate at 0.888% so it is the still a good time to take on a fixed rate, at their lowest value ever.
.
French interest rates and how they work
.
Most of the French Mortgage lenders index their rates to the Euro Interbank Offered Rate, or Euribor, the average interest rate at which term deposits are offered between prime banks in the EU wholesale money market or interbank market. Just like the LIBOR serves as a short-term reference rate for British Pound and U.S. Dollar, the Euribor is widely used as a reference rate for Euro.
.
The French banks usually index their rates to Euribor 3 months currently at 0.888%. Each bank applies a margin of between 1.30% to 2.50% depending on the lender and the product’s features.
.
Variable products are usually redemption penalty free, although some banks may charge penalties in case of a re-mortgage. Fixed products are currently very low and very popular, but capped products starting at 3.50% and capped at 4.50% are also recommended in the current climate.
.
Best French Mortgage products currently on the market
1. 100% LTV French mortgages with capped rates starting from 3.50%*
2. Rates fixed for the entire term starting from 3.15%**
3. Some French products are capped at 1% above the initial rate, to give you more security
4. Interest only mortgages with variable rates starting from 2.85%
5. Rates starting from 2.40% for equity release and re-mortgage
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Rate type	Interest rate***	Maximum LTV	Monthly repayment for €100,000 over 15 years
Variable Interest Only	3.00%	80%	€250
Variable Repayment	2.20%	80%	€658
Fixed Interest Only	2.95%	65%	€246
Fixed Repayment	3.85%	80%	€732
Capped Repayment	3.50% capped at 4.50%	100%	€723

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* You would only be expected to pay the Notaire fees and the estate agent’s fees. Available only for properties of over €300,000
** Over a short term of 6 years on a repayment basis, for a loan of or above €230,000
***Higher rates may be applicable for longer terms and different loan amounts
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For more details regarding French mortgages, you can have a look at our website dedicated to French mortgages: http://www.sextantmortgages.com
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If you would like to receive a free quote with no obligation, contact our in-house mortgage consultants by telephone: 0207 428 4918 or by email: mortgages@sextantproperties.com
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French Property mortgages increase by 17% according to study

Rachel — Fri, 30 Jul 2010 11:34:29 +0000

The total figures of French property mortgages granted by the French banks in 2010 should reach €140 billion in 2010, which is 17% more than in 2009, but remains far from the 2007 record of €170.23 billion, according to a study by the French central institution of property mortgage security “Crédit Logement/CSA”, published last Wednesday.

However, French mortgage rates have continuously kept on dropping since the end of 2008, getting closer to their historical floor (3.36% in the 4th quarter of 2005), to settle around an average of 3.42% in June, whereas they were still at 5.07% in the last quarter of 2008. The consequence for borrowers is a decrease of almost 10 % in monthly payments in comparison with 2008, emphasizes Crédit Logement.

“Unemployment and purchasing power outlooks are still standing in the way of a real upturn in mortgages” says Michel Mouillart, the author of the study.

Despite the war for new customers among French banks, the other phenomenon affecting the mortgage market is the soaring of French resale property prices, which are now about where they were before the 2008 crisis.
Since the end of the 90’s, French prices have risen by 140%, and are now 22 times higher than in 1964, which is much more than the inflation, Crédit Logement notes.

Source: Le Figaro

The 104% French mortgage

Aurelie — Thu, 22 Jul 2010 14:25:58 +0000

If you are looking for financing for your new leaseback project, the 104% mortgage product is one of the best financial products of the moment. Launched this July by a French bank, you only need to pay the bank fees. There are two options available with this product: repayment or interest only.
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Let’s take an example to explain how this product works. In Brittany, Sextant French Property offers a leaseback in Benodet. For €236,520 (VAT excluded), you can have a 1 Bedroom Apartment in a secured residence with sauna and heated swimming pool.
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Most of the time, when you ask for a mortgage, you receive a mortgage for 100% of the total amount of the leaseback property (VAT excluded)). In this case with the “104% mortgage”, you will be able to receive 104% of the total amount. That means it will cover the purchase of the property but also the legal and tax expenses.
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Thereby, to be able to buy this 1 Bedroom apartment in Benodet, you need to make a deposit of 5% of the value of the property (VAT excluded)) that is €13,492. You will get back this 5% deposit when you sign the deed of sales in front of a notaire. Consequently, you will only need to pay the bank fees: 1% of the total amount. That is €2,365 in the case of the apartment in Benodet. To be clear, your new property will only cost you the bank fees which means that you will just need to have this amount available.
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To sum up, here are the main criteria of the 104% mortgage:

- 5% deposit of the VAT price (back at the deed of sales).

- Mortgage on 104% (VAT excluded)

- Only need to pay the bank fees.
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To apply this 104% mortgage product, here are the main requirements to be eligible:

- Age: from 18 to 75 years old (before the end of the loan)

- Maximum debt/ratio: 30%

- Can be employed, self-employed or retired.

- If you apply for an interest only, you must have a side investment of 20%.
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This product is available for a shortlist of French leaseback companies. If you are interested, don’t hesitate to contact one of our Sextant Consultants on Sextant New Build Website. And if you are not eligible for this product, don’t worry! Contact one of our Mortgage Advisors by Sextant Mortgage Website since there will always be a mortgage adapted for your project.
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New Mortgage with variable rate available

Rachel — Mon, 12 Jul 2010 16:06:27 +0000

.The French banks usually index their rates to Euribor 3-month currently at 0.827%. But if you are currently looking for a mortgage to finance your project, a new financial product with variable rate might be suitable for you.
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One of our French bank partners just launched a new product in order to finance a holiday home or a leaseback: “the Foncier 3-month variable rate”. This mortgage is based on the variation of the Euribor 3-month index that allows the product to perform like a reviewable rate. Currently at 2.70 %, this variable rate means that only the monthly payment evolves; the term of the mortgage remains unchanged. With a term from 6 years to 25 years, this mortgage offers a large flexibility as you will be able to pay back part or totally after 12 months without any fees.
Moreover, the borrowers who earn at least €50k/year can change to a fix rate at anytime during the length of the mortgage.

To sum up, here are the main points of this 3-month variable rate:
- 2.70% rate
- Based on Euribor 3-month Index variation
- Term from 6 years to 25 years
- Possibility to pay back after 12 months

Here are the main criteria to be eligible for this mortgage:
- Minimum joint income of €50k per year
- Age: from 18 to 80 years old
- Maximum debt ratio: 35%
- Must be a home owner

This brand new product is the perfect combination of flexibility and an attractive rate, a perfect way to finance your estate project.

If you want to receive more information regarding the Foncier 3-month variable rate, do not hesitate to get professional advice from our Mortgage Advisors in order to receive simulations for this mortgage. You can also visit our French Mortgage website for the latest rates available.

Which French Leaseback should I choose?

Rachel — Fri, 09 Jul 2010 10:00:00 +0000

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Nowadays, if you want to finance your French leaseback property, it is better to select one which has a yield lower than 5%; otherwise, banks might decline your mortgage because they will be afraid that the management company of your leaseback will not fulfil all the financial requirements.
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However, buying conditions in France are currently excellent. The exchange rate is extremely favorable since Sterling reached a 19-month high against the euro at the end of June reaching €1.203. If you’re thinking about purchasing a leaseback property, you might be interested in one of our new programs in Argeles Sur Mer, a traditional small village located in the south of France on the Mediterranean coast, at the foot of the Pyrenees Mountains and the Spanish border. With its 7km of sandy beaches, long flower-bedecked and landscaped seaside promenade, Argeles draws in the crowds every year. Les Demeures de la Massane is a new residence offering apartments and villas with terraces and/or gardens. Purely Mediterranean in style, its architecture is a harmonious blend of wood, light coloured stone and ochre shades. The communal area comprises an aquatic centre with a swimming pool and a paddling pool, a spa with sauna, gym and a Jacuzzi, a games area for children and a bowling pitch.
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If you purchase a 1 bedroom apartment for 120k€ HT in this residence, you will receive an annual rental income of €4,560 HT with a yield of 3.80%. The rent will be paid by the management company, regardless of the actual occupancy of the premises.
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In order to obtain a mortgage for this leaseback, you can ask for an interest only mortgage with 100% LTV (Loan to Value Ratio). Accordingly, it will cover 100% of the purchase price of your property excluding VAT (the VAT is financed by the developer) but you will need to secure 30% of the total amount on a side investment such as on a life insurance contract or a bond. It is important to know that when you purchase a leaseback, you will need to fulfil financial obligations. Indeed there may be some shortfalls that mean that the capital required to fulfil these obligations may exceed the available capital. But there is no need to worry; with this kind of investment you are more likely to have a low shortfall.
If you want more information regarding investments options on this leaseback, we can send you a detailed leaseback simulation.
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In addition, as the rental income of your new property will be revised every three years in line with the reference rental index, there will be a clear capital appreciation after a few years. The rise in the value of your asset is also an important part of your investment.
To sum up, there are four major points that will allow you to develop the value of your asset:
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- The capital appreciation. This is part of the return on investment and must be considered as an investment goal from the beginning of the project. The property value of your investment will increase through the years due to price inflation.
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- The side investment interests. By securing 30% of the total amount required, you will not just be making a classic deposit as this side investment will add revenues to your asset, by generating interests. For example, with a secured amount of 36k€ HT on a life insurance contract for a purchase of 120k€ HT, you are able to obtain a yield of 4%. It will be a considerable capital received just from the interests of this side investment.
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- The rental appreciation. It should definitely be considered as the main part of the leaseback investment. Revised every three years, your rental income is likely to increase from a minimum of 1.5% to 2% maximum per annum. Consequently, shortfalls will certainly decrease every three years.
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- The diversification of your investments. These leaseback mortgages are a good way to generate additional revenues and are more rewarding years later if you are able to purchase another one in a different location. These assets will be a major security for your golden years.
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So if you are interested, do not hesitate to get professional advice, for example from Sextant Mortgages in order to receive simulations for leaseback mortgages.

French Mortgage Success Story with Sextant

Rachel — Wed, 07 Jul 2010 15:42:41 +0000

On the 15th February 2010, the office received a call from a new client called James D., requesting additional information on certain properties in France that were for sale on the Sextant Properties website. Emmanuel immediately sent the information requested, and James D. replied within twenty-eight minutes , informing Sextant that he would be in France in April and would like to arrange a viewing during that time.

James D. also needed information on French mortgages so Emmanuel passed on his details to the Sextant mortgage department. The financial advisor, Mansoor, wrote to the client for further personal information, sourced a few products and sent them to him (5/3/2010).

The client was happy with the quotations and chose the one recommended by Mansoor. The decision in Principle was created and immediately sent to the bank. The mortgage department then received the Agreed in Principle status from the bank within forty-eight hours, and sent the approval to the client together with a mortgage application form and a list of documents required, on the same day.

James D. went to France, and found his dream house (10/4/2010). He wrote back to the advisor, who recalculated the figures and together with other requested documents, sent off the paper work to the French bank. James D. was extremely happy as he was mortgage ready thanks to the Sextant mortgage department and staff; consequentially he managed to sign the “compromis de vente” within a week and completed his purchase.

If you are also interested by getting a French Mortgage visit our website: www.sextantmortgages.com

July French Mortgage Update

Aurelie — Tue, 06 Jul 2010 13:29:00 +0000

Interest rates in July remain unchanged compared to June 2010. They are still lower compared to January 2010 with the Euribor 3 months rate at 0.634% so it is the still a good time to take on a fixed rate, at their lowest value ever
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French interest rates and how they work
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Most of the French lenders index their rates to the Euro Interbank Offered Rate, or Euribor, the average interest rate at which term deposits are offered between prime banks in the EU wholesale money market or interbank market. Just like the LIBOR serves as a short-term reference rate for British Pound and U.S. Dollar, the Euribor is widely used as a reference rate for Euro .
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The French banks usually index their rates to Euribor 3 months currently at 0.634%, 0.046% lower than in January 2010. Each bank applies a margin of between 1.30% to 2.50% depending on the lender and the product’s features.
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Variable products are usually redemption penalty free, although some banks may charge penalties in case of a re-mortgage. Fixed products are currently very low and very popular, but capped products starting at 3.50% and capped at 4.50% are also recommended in the current climate.

Best French Mortgage products currently on the market
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1. 100% LTV French mortgages with capped rates starting from 3.50%*
2. Rates fixed for the entire term starting from 3.15%**
3. Some French products are capped at 1% above the initial rate, to give you more security
4. Interest only mortgages with variable rates starting from 3.00%
5. Rates starting from 2.40% for equity release and re-mortgage

Rate type	Interest rate***	Maximum LTV	Monthly repayment for €100,000 over 15 years
Variable Interest Only	3.00%	80%	€250
Variable Repayment	2.20%	80%	€658
Fixed Interest Only	3.95%	70%	€329
Fixed Repayment	3.85%	80%	€732
Capped Repayment	3.50% capped at 4.50%	100%	€723

* You would only be expected to pay the Notaire fees and the estate agent’s fees. Available only for properties of over €300,000
** Over a short term of 6 years on a repayment basis, for a loan of or above €230,000
***Higher rates may be applicable for longer terms and different loan amounts

For more details regarding French mortgages, you can have a look at our website dedicated to French mortgages: http://www.sextantmortgages.com
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If you would like to receive a free quote with no obligation, contact our in-house mortgage consultants by telephone: 0207 428 4918 or by email: mortgages@sextantproperties.com
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June French Mortgage Update

Matthieu Cany — Tue, 08 Jun 2010 14:13:21 +0000

Interest rates are lower compared to January 2010 with the Euribor 3 months rate at 0.634% so it is the best time to take on a fixed rate, at their lowest value ever

French interest rates and how they work

Most of the French lenders index their rates to the Euro Interbank Offered Rate, or Euribor, the average interest rate at which term deposits are offered between prime banks in the EU wholesale money market or interbank market. Just like the LIBOR serves as a short-term reference rate for British Pound and U.S. Dollar, the Euribor is widely used as a reference rate for Euro .

The French banks usually index their rates to Euribor 3 months currently at 0.634%, 0.046% lower than in January 2010. Each bank applies a margin of between 1.30% to 2.50% depending on the lender and the product’s features.

Variable products are usually redemption penalty free, although some banks may charge penalties in case of a re-mortgage. Fixed products are currently very low and very popular, but capped products starting at 3.50% and capped at 4.50% are also recommended in the current climate.

Best French Mortgage products currently on the market

Rate type	Interest rate***	Maximum LTV	Monthly repayment for €100,000 over 15 years
Variable Interest Only	3.00%	80%	€250
Variable Repayment	2.20%	80%	€658
Fixed Interest Only	3.95%	70%	€329
Fixed Repayment	3.85%	80%	€732
Capped Repayment	3.50% capped at 4.50%	100%	€723

For more details regarding French mortgages, you can have a look at our website dedicated to French mortgages: http://www.sextantmortgages.com

If you would like to receive a free quote with no obligation, contact our in-house mortgage consultants by telephone: 0207 428 4918 or by email: mortgages@sextantproperties.com