Buying a House in France – Getting a Mortgage or Prêt Immobilier


Yesterday a large fat white envelope appeared in my letterbox. After all the all the effort taken to get this far you would think that I would be dancing around the room, but the mortgage process in France has been such an exhausting journey that I gave the envelope the kind of look you would reserve for a very wilful and difficult child that has had a month-long tantrum! And perhaps thankfully I was too worn down to rip the contents out of that envelope as, had I done so, I would have surely annulled the mortgage offer inside, since in small black letters were the words,

“Do not fold or tear. This envelope is to be used for the signed return documents”

When you have lived in France as long as I have, you learn to be very very careful about all official correspondence as, no matter what, you must comply with the seemingly most bizarre requirements. I have learnt not just to read things through once, but to do it ten times, to never ever fill in a form with blue ink when it stipulates black, and always, always provide copies of every official certificate, plus a few extras, even when applying for something as mundane as a rail travel card!

But I digress!

You may remember that in September I “bought” a house without my husband ever having seen it, and underwent the scrutiny of the 87 year old owner and the notaire in a particularly transparent overview of my financial capability to buy the said house on an overhead projector screen! At the time both notaire and owner declared that the mortgage interest simulation rates obtained  so far were simply not good enough and that I needed to “have another go” at the process.

I confess to being a “detail” person, and frequently drive my husband to distraction, which is perhaps why he spends most of his time half-way across the planet, but that aside, I took the notaire at his word, and minutes after having signed the “compromis de vente“,  was striding down the main banking street of Rouen determined to come up with a deal.

There are a good 12 or so banks on the main thoroughfare, and by the end of the afternoon I had visited each and every one of them, and left with a date and time of “rendez-vous” with most and already in posession mortgage simulations from three. Last stop of the day was with the “Courtier” (mortgage broker) recommended by the notaire.

By the time I finally met with the courtier three days later I had 9 mortgage simulations in my ever expanding “dossier” file.

“Well”, said the cheerful and energetic Courtier, “have you passed by any banks yet?”

Proudly I nodded the affirmative, and proceeded to rattle off the names of all that  i’d visited, noticing that as I did so his face becoming less and less cheerful in proportion to the number of visits that i’d made.

“Vous étès sportive, alors” (you’ve been very proactive!) “what banks haven’t you seen?”

What I then came to learn was that once a client has passed directly to a bank, a mortgage broker cannot “solicite” the same bank for a further month. Since a time delay is stipulated in the “Compromis de Vente”, this put a finite limit on the length of time available to the courtier. Consequently he was left with my own bank, the post office and one “bottom of the market” bank, the only meetings that I had organised after that of the Courtier. While I held the lead players, the Courtier had his work cut out!

To cut a long story short, I selected three banks from my 9 simulations for the best interest rates and made second appointments to create a “dossier” (mortgage application) With my now enormous cereal packet sized folder, I supplied each bank manager with page after page of official documents; “Bulletins de salaire” (salary statements), “contrats de travail” (work contracts), I had several hundreds of those since each guided tour is covered under a separate contract. They photo-copied each and every one!), “relevés de compte bancaire” (bank statements), passports, electricity bills, and “attestations for Allocation familiales” (family allowance statements). I even had a “Bilan cardiaque” (ECG) up my sleeve and they took that too! And then I left thinking that that would be it……

 

 

But no!

I received emails from the bank managers; some wanted a copy of my “Carte de Sejour” (Residency card), even though EU nationals  don’t need one, others asked for “Avis d’Impots” (Tax records) going back three years, and all wanted proof of our “apport personnel” (personnal contribution), and I sent them all in and thought that would be it…..

But no!

It turned out that to take out a mortgage with a bank, we had to open up a bank account, which meant reims and reims more paperwork, no matter whether we might actually be offered a mortgage, and then the final crunch……

“Monsieur doit signer”.

Aha, I said, flourishing under their noses our “procuration” (Power of Attorney) specially drawn up by the notaire. But on this all three banks could agree,

“NON” they said, “Monsieur doit signer”

Since Monsieur was in Canada, and likely to remain there for several more months, this caused something of a dilemma. But since the “Compromis de Vente” required me to provide a mortgage offer by the middle of November, or lose our deposit, there was nothing left to do but fly Monsieur back. And Monsieur duly arrived for a whistle-stop four day “signing schedule”, and finally, the opportunity to finally see what house his wife had bought!

In France  a life assurance policy is obligatory when buying a house. A buildings insurance policy is only advisory. Having received an “accord de prêt”, a nod from the bank that the loan to income ratio is approved, the next stage is to be approved by the life assurers. This involves a detailed medical questionaire, and dependant upon the age of the applicant, a huge array of medical tests. In order to anticipate the assurers requirements, I had organised a appointment with out médecin généraliste to coincide with the “signing schedule”. All of the banks had already provided us with a medical questionaire, one of which needed completing by the doctor, and we requested that the doctor gave us an “ordonnance” (prescription) for every blood test he could think of. Husband à l’etranger lost the majority of his blood to the syringe that afternoon and the results were ready by the following morning. We duly supplied each bank with the results and questionaires, husband à l’etranger had just about time to sip one coffee in his favorite bar before he was back on the plane,  and sat back to wait for our offers….

And one duly arrived several days later from one of my banks …but with strings attached!

No sooner was husband à l’etranger back on Canadian soil than the bank, who hadn’t originally required a questionaire completed by the doctor, posted one out to us,…. and requested two further blood tests,…. and a ECG done within the last six months. When I informed the bank that there was a four month waiting list for an ECG, and provided an ECG done in the last 12 months as an alternative, the assurer gave us the standard response:

“Mais NON!, Monsieur” and the name of a cardiac clinic who could deal with the matter the same week….

..in France!

My own personal charms were no match for the Courtier’s contacts, and thankfully several days later I received a message that his medical assurers had no need for further information and that his bank’s offer would be soon in the post; and I sat with my fingers crossed hoping it would arrive before the ever approaching deadline.

So when the envelope arrived on saturday, you can probably understand why I was too exhausted to dance a merry jig round the hall!

After all, all that’s left to do now is to get Husband à l’etranger to initial every page and sign the darn thing and return it within the deadline, and despite the fact that I have the “procuration ” (power of attorney) to do it for him, it says quite clearly in bold black print:

“A remplir de la main de Monsieur” (to fill in in Monsieur’s own hand)

And you know what that means don’t you…?

But maybe this time he’ll get time for a second coffee!

 

 

Buying in France – The Compromis de Vente


There’s one thing more frightening than signing a Compromis de Vente, and that’s signing one without your husband or children ever having seen the house. The Compromis is essentially the first of the two major contract documents in the house-buying process. Essentially once signed, the buyer has seven days to cool off and back out without having to give any reason or justification. Once the seven days have passed, the only way out is either to loose the 10% downpayment of the agreed house value, or to be able to show a refusal from the bank of a mortgage application.

I have six days to go until my neck is firmly on the line, and I have already one child who is unhappy about the idea of a bedroom with a sloping ceiling. He should perhaps consider himself fortunate. If the mortgage application does get refused, and having given the statutory 3 months notice to vacate our appartment, it could be the sloping roof of a tent and not that of a plastered ceiling that he will be looking at!

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There are some major differences between the english system of house buying and that of the french. In the english one, either party can back out at any moment which also leaves the seller open to higher propositions from other buyers, and the buyer open to being gazumped. It all rests on the traditional english handshake, more often metaphorially than not.

The french system is protective to buyer and seller. The agreement on price and the committment to buy are  determined from the minute the two parties sign the Compromis de Vente. On top of this written agreement, there is always a handshake, and often rather hot and sweaty when one considers the enormity of what has just been signed! Should the seller decide to change their mind after the Compromis de Vente, they are obliged to pay the buyer twice the value of the 10% downpayment. If the house is burgled, destroyed through earthquake fallen tree or fire, the owner’s insurance is expected to pay for all repairs and the buyer has the choice to withdraw free of any loss of deposit.

It was a somewhat bizarre experience to arrive at the Notaire (solicitor) and find the seller already seated in the waiting room. But this is the french system, and both parties negotiate through the same notaire. There is no flying backwards and forwards of emails between independant solicitors, as in the UK, and none of the eventual delays caused by solicitors simply not responding to information requests. Neither is there the opportunity to start to renegotiate the price as a result of the diagnostic (survey of electrics, lead, termites,asbestos, damp  and gas issues) The diagnostic is for information only to help the buyer to be aware of any potential risks. It seemed odd to be seated around the same conference table while the notaire read through the entire contract, birth details, marriage dates, careers of the two parties, followed by the value of the loan applied for by the buyer and their persaonal savings. But since the loan application is the only valid reason for breaking the contract, the details are important and clearly have to be judged realistsic.

It was with a certain level of vulnerability that I saw my worldly wealth displayed on the overhead projector for all to see. The balance of my savings alongside the value of my mortgage application. It was only at this moment of “bearing all” to the seller that I got a view of the generation gap between modern-day France and that of my seller’s generation.

“Ouf, c’est assez important” – “Oh, that’s quite a large mortgage” stated the 87 year old Monsieur S

The notaire looked at me with some sympathy,

“C’est attendu de nos jours”  – “It’s quite normal for this day and age” he replied

“Quand même” replied Monsieur S,  “à mon jour nous avons mis un peu à coté, semaine par semaine” – “All the same, in my day we put a bit aside as we went along”

The notaire threw me another sideways look of sympathy

“C’est normal, Monsieur, N’inquiète pas” – “It’s normal, don’t worry”

but his gentle words of reassurance hit an all time low when the notaire turned to ask me when I would like to have ownership of the house. Not knowing what duration the banks took to produce a mortgage offer in France, nor what duration to expect for the administration, I suggested the typical time delay of the UK, around three months and Monsieur S nearly collapsed in his chair.

“Trois mois?” he stammered, mouth agape, “on inquiet sur le prêt, alors”.” Three months? Then you have doubts that you’ll get a mortgage, why so much time?”

“Aucun souci, Monsieur” ” No worries at all” I hastily assurred him

As I discovered, at the end of the 7 day cooling off period, the buyer has the right to 30 days to obtain a mortgage offer. And having both studied my current mortgage simulation, they both declared,

“You can do better than that”, “Il faut faire la concurrence,  Il faut les battre” “Make the banks compete against each other. Make them work for their money” and typically, as only it can happen in France, the notaire leant over with a name and a phone number,

“Tell Monsieur P that I sent you” he said handing me the name of a mortgage broker on a piece of paper.

As we were leaving Monsieur S stopped at the door,

“Si je peux reprendre le clé du jardin” ” If I can have the garden gate key back again” he said, putting out his hand for the old key he had lent me the weekend before so that my children could gather the newly fallen hazelnuts from his lawn.

I stepped out onto the street full of energy to take on the french banks, but poor Monsieur S  had a look that said he was perhaps fearing that he would wake up in a day or two and discover a family of six in a large tent in his back garden.