Mortgage application Query

[Brigodoon]

Hi to all.

 

My first, of hopefully many, posts on this forum.

We (my fiancée and myself) have been pondering for a while on taking the ‘big step’ and moving to France (we don’t know where as yet!).

I am currently doing the background work first, and our obvious first step would be to; find out what we could comfortably afford, draw up a list of properties then find a suitable long term (6-12month-ish) rental to use as a base.

 

My query is this:

An article, in the ‘Expert Advice’ section [http://www.livingfrance.com/expert-advice-finance-mortgages-mortgages-in-france—143915] states “The French lender will normally allow between 30 and 40 per cent of your gross income to be taken up repaying any existing mortgages you may have, other loan commitments and the new mortgage you are looking to take out on your French property”.

Presumably, this figure of gross income is the amount ‘before UK tax’ as stated on my monthly pay slip or P60 before deductions etc… or is the gross income interpreted as the gross income left over ‘as above’ from myself and my fiancée?  

As my fiancée will be “effectively” taking early retirement (i.e. no income until pension date….many years off I may add!!) therefore, I don’t think her current salary should be taken (whether it’s before or after Tax) in to account for purposes of mortgage application/affordability.

 

I also would like a bit of advice:

I know I should be making mortgage queries as early as possible, however, If I start an application now (i.e. current UK mortgage, couple of personal loans etc) the overall mortgage loan amount figure offered would be substantially lower than, if I were to, for example, rent in France for a period whilst my current home in Aberdeen is sold, which would in turn, after clearing my loans etc.., give me potentially a greater mortgage and/or a lower LTV percentage?

What do you think?

 

Thanks, thought it best to ask before committing myself to a French mortgage broker.

 

Thanks again.

 

[Panda]

Hello

The french mortgage companies work on % of net disposable income, so if you have a net income after tax and NI of say 4k, you have a UK mortgage of 1k per month, loans of 500 pounds then the 30% (it was 30 earlier this year when I was looking)would be of the remaining 2.5k so around 833 which would get you about 90kish depending on the interest rate.

If you have property to sell then I would say sell it first, otherwise with an exisitng mortgage you may struggle to convivnce the mortgage company to loan to you. Its much harder to get a french mortgage than it was a few years ago (as it is any where these days) so get in the best position you can.

[Chancer]

[quote user="Brigodoon"]

  

As my fiancée will be “effectively” taking early retirement (i.e. no income until pension date….many years off I may add!!) therefore, I don’t think her current salary should be taken (whether it’s before or after Tax) in to account for purposes of mortgage application/affordability.

 

I also would like a bit of advice:

I know I should be making mortgage queries as early as possible, however, If I start an application now (i.e. current UK mortgage, couple of personal loans etc) the overall mortgage loan amount figure offered would be substantially lower than, if I were to, for example, rent in France for a period whilst my current home in Aberdeen is sold, which would in turn, after clearing my loans etc.., give me potentially a greater mortgage and/or a lower LTV percentage?

What do you think?

 

Thanks, thought it best to ask before committing myself to a French mortgage broker.

 

Thanks again.

 

[/quote]

But would you still have an income after you sell your home in the UK?

Ridiculous as it may seem French mortages are granted on the basis of salaries which will no longer be applicable after moving to France, do it before you move unless you will have a proveable income once you are in France.

[Brigodoon]

Hello Panda,

Thanks for your reply, that's exactly the answer I was looking for... and funnily enough your not far off the mark with your figures!

I agree, the 90k-ish wouldn't really get the property that I was thinking of.. and after all, it's going to be our home (where ever we decide) for the long term, we would like to get the right place with no regrets, with full commitment.

I best concentrate on looking for rental accommodation in the meantime and leave the house hunting until we are based, settled, 'basically' financially secure and free from any ties.  

My revised first steps will now be opening a French Bank Account (Harvey our dog should have his Pet Passport soon) then securing some rental accommodation. (hopefully Pet frendliy!).

Thanks again for your sound advice, very much appreciated. 

 

[Brigodoon]

Hi Chancer,

Yes, thanks for that, I would have an income.

For several years, I have been working offshore (I am bobbing about in a North Sea gale at the moment!) - 28days on 28days off.  The company I work for has no issues where I live in the world really (within reason), as they also pay for flights etc, the only real requirement is that I live within 1hr from an airport (preferably with international connections).

Thanks for the thought though.