French mortgage - be warned!

[Geranium]

We have gone through the process of getting a pretty substantial mortgage on a new house.  Like all french mortgages we wre required to take their Life Cover on my husband.

First of all he must have had every health check known to man and it took ages.  But at least I know he is in storming good health.  However the insurance company required a couple of checks never done in the UK and there was some confusion.  An Antibody test was done and they apparently wantd an antigen test.  Then they insisted that the doctor wrote a seperate letter on his headed notepaper rather than a note on the form (this is cutting a long story short!).

We did everything by the book; got the mortgage offer in August, transferred the deposit at the beginning of October ready for completion at the end of October.  But these extra requirements from the Insurance company held everything up.  They professed not to have received papers etc. and completion could not take place.  the bank of course flatly refused to release funds until the insurance company gave the go-ahead. Very frustrating.

So be warned; getting your mortgage sorted may be OK but the insurance can take AGES and throw out all your plans.  Having applied for a mortgage before the end of June, we are now completing on 7th December!

Oh and another warning.  We went through Barclays France and they have been appalling.  They dont answer calls, say they haven't got papers, say they'll release funds and then don't. Awful.

[Teamedup]

I'm afraid it isn't just Barclays France, friends went with the BNP and had the same problem with paperwork regarding insurance. And it was the banks fault and it took months. That is why we all need clauses in purchasing agreements to allow for a mortgage being granted or not, if the insurance doesn't span out then they won't give them.

[Logan]

Don't blame Barclays. It is normal for all French banks to behave in the way you described. In fact the descriptions of your experience is also normal in France. Everything takes an age. Everyone is inefficient slow and pedantic. That is France. It's part of the culture and you need to get used to it if you plan to live here. If you think Banks are bad try going for a job interview with a government department or applying for a grant. France is very different to Britain. You have discovered only one of the ways. There are countless others. There is a tendency to apportion blame easily when things do not run smoothly according to your expectations. If you stay in France long enough you will end up blaming everyone and feel utterly dissatisfied with life here. When you leave Britain behind leave your expectations of an anglicised France behind as well. France really is another country in every sense of the word.

[BJSLIV]

You have only really settled into The French Way when you are comfortable with and cheerfully accept the concept of the"Dossier" ie everything and anything needs a file, with as many pieces of paper as possible. If the thickness of the Dossier can be increased by demanding  6 copies of everything then thats all to the good. The more papers requested , the more chance of something wrong, so a bit more delay.

If you notice when French people visit the Mairie, Notaire or whatever they are usually lugging some sort of file. The TV news stories where someone has been wronged by the state or private enterprise another heap of papers on the dining table.

I sometimes think that this is the real reason why Email etc has been slow to take off in France, because the etiquette of including printouts has yet to be worked out. For example is 6 copies are required it would clearly be unacceptable to print one file six times. Six separate transmissions would clearly be de rigeur.

You just have to regard everything as a cross between Alice in Wonderland and Snakes and Ladders. Its all part of the charm that first attracted us to France I suppose.

Oh and don't forget that when you are helping to build up the Dossier, many of the submissions will have to go Recorded Delivery otherwise they won't count.

Oh particular pleasure should anticipated when you see that "Frais De Dossier" has been added to a transaction.

[Judie]

I'm afraid our experience was very different - mortgage through within 4 weeks - no medical required for health cover. Just shows you how things vary across France.

Judie

[Deby]

Yep, sounds about right. Everything six fois (6 times), still better than a UK mortgage overall.  You dont just have to go to English bank affiliates as these banks still have to operate under french law.  I know it is comforting to have a name which you can recognise but dont be fooled. BNP are quite good, try the Caixxa (believe they are even Spanish).  Usually all have someone who speaks English.  My advice is invest in a translator who deals in Finance. 

Anyone who wants a recommendation you can pm me.

Deby

[Maddie]

Initial mortgage through local CA no problem at all (offered far more than we thought they would - 100% in fact).  Six months later asked hubby to go for a shed load of blood tests (including HIV with no mention of any counselling first).  One test had slightly higher levels that normal.  They have refused cover but given accidental death cover only.  Hubby has to have test repeated at his own expense next July.  Our own GP in UK, when shown the report, understood exactly what the test was and said it was nothing to worry about as the test was extremely sensitive and could have been affected by something as small as having a glass of wine too many or a painkiller the night before!  A bit worrying though.  Hubby can only now "peg it" as a result of an accident...Mmmmmm...now that's a thought!!! Tee hee!! 

 

[Geranium]

It's been interesting seeing the responses to my post.  We already have a house in France - purchased 2 years ago with cash.  I continually read a great deal about France and the house buying process and was pretty clued up when we decided to buy this house.

However, while books and magazine articles explain the contracts, the notaire etc, I think there is very little said about the insurance cover required.  My post was therefore to warn people that this is a far more involved check than found in the UK and that it can a long time to get all the tests done, sent verified, and finally insurance granted.

Now, can anyone recommend a euro savings account; I already have a current account with Credit Agricole?

[passiflora]

Hi

You could just have your savings account with CA.  I came across a problem with savings accounts as it appears to have a savings account you have to have a cheque account and pay for the card to go with it.  This was not my original idea and all the options AXA offered me for saving my money cost me money to do!  Interesting that! In fact the chap at AXA told me all the savings accounts rates were about the same and unless I wanted to move my current account from CA there was little point in having an account with them. It took me two and a half hours to find that out.  I do find this sort of thing so frustrating.

CaroleS (16)

[marieloona]

I have had dealings with many of the French banks now including Barclays and have found the service from Barclays pretty bad. They should be ashamed that they are wasting money on flashy ads in property magazines when the service is awful after. 5 months to get a mortgage offer with hardly any correspondence is not on!

[Floodfamilyagain]

Another thing to be aware of is the extent of the insurance cover attached to the mortgage.It is quite normal with french mortgages for cover to be split 50/50 between the couple so if one partner dies only 50% of the mortgage would actually be covered by the policy. Reading the very small print with Abbey France this was also the case and we have had to specifically request for joint cover of 100% each so the intial quote wasn't as competitve as it first seemed.

[Floodfamilyagain]

Another thing to be aware of is the extent of the insurance cover attached to the mortgage.It is quite normal with french mortgages for cover to be split 50/50 between the couple so if one partner dies only 50% of the mortgage would actually be covered by the policy. Reading the very small print with Abbey France this was also the case and we have had to specifically request for joint cover of 100% each so the initial quote wasn't as competitve as it first seemed.

[Nick Trollope]

Our experience flies in the face of most of the other posters;

Application was 4 sides of A4 (in English), medical questionaire 2 sides A4. Completing these and collection the info we needed (payslips etc.) took 1/2 day. We did write a proposal addressed to the bank (this was a development purchase). Offer was received within 10 days of us providing the final bit of info (a quotation for building work, which took an age to get), although our chap at the bank said that it was OK at the first meeting. No medical, and we were given a choice of cover (100%/100%, 50%/50%) we went for 100%/50% (me/her) as it represented best value.

Mortgage amounted to 130% of purchase price (including a seperate loan for development).

Excellent rate, too (3.5% capped to 5.5%). No penalties for early repayment (which we intend to do).

Cred Ag Cotes d'Armor - the only thing that could work specifically in our favour is that it is not Britline, and that we banked with them for 2 years before we applied for the mortgage.

I can put anyone who is interested in touch with our contact at the bank (he speaks no English, but is enthusiastic about lending to the English).

[Fontremy]

Amazing - your experience is very similar to ours. Requirement for life assurance depends on the amount being borrowed, hence the different experiences illustrated here. Unfortunately most French banks won't accept UK life cover, which is very irritating if you have plenty.

In fact, having gone through the hassles almost identical to the above we were issued an offer (by Abbey National) which had conditions attached which were the opposite to that we had stipulated on day 1 eg allowed to rent as a holiday home, no early redemption etc. I think they thought that after all the hassles we would have no choice but to roll over. However, we started again, this time with a very agitated vendor getting hot under the collar. Luckily the second lender moved remarkably quickly and we got things sorted just in time. I have to say that throughout the trials and tribulations Propertyfinance4less our brokers were very good.