subject: August French Mortgage Update [print this page] Most of theFrench 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 0.899%. 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
Variable Repayment
Interest rate***: 2.20%
Maximum LTV: 80%
Monthly repayment for 100,000 over 15 years: 658
Variable Interest Only
Interest rate***: 3.00%
Maximum LTV: 80%
Monthly repayment for 100,000 over 15 years: 250
Fixed Interest Only
Interest rate***: 2.95%
Maximum LTV: 65%
Monthly repayment for 100,000 over 15 years: 246
Fixed Repayment
Interest rate***: 3.85%
Maximum LTV: 80%
Monthly repayment for 100,000 over 15 years: 732
Capped Repayment
Interest rate***: 3.50% capped at 4.50%
Maximum LTV: 100%
Monthly repayment for 100,000 over 15 years: 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
