Mortgages for Luxury French Property with...
100% Purchase Price Financing!
THE ALLURE OF THE FRENCH RIVIERA
Nestled on France's southern coast, near the Italian frontier, the French Riviera showcases some of the most enchanting towns you could envision. With its chic allure, this region has magnetized celebrities for generations. Boasting approximately 300 sunlit days annually, its climate is nothing short of ideal. From designer boutiques, to the array of nearly 40 Michelin-starred restaurants, it's a destination of elegance. It's also a thriving community of English and American expatriates.
TOP DESTINATIONS FOR PROPERTY OWNERS
Surrounded by both the majestic mountains and the serene sea, the Riviera promises a perfect balance. While the coast will be your regular retreat, snow-capped peaks are always within reach for a winter getaway. Explore the top places to reside in the Riviera:
- Antibes: Originating from the 16th century, Antibes exudes a maze-like ambiance. Renowned for its breathtaking golden glow, which has attracted artists over the centuries, it houses magnificent villas in the wooded Cap d'Antibes.
- Cannes: Apart from the high-end boutiques and its iconic film festival, Cannes is a stone's throw from the secluded Lérins Islands.
- Nice: As one of the significant French cities, Nice offers a vibrant nightlife, chic boutiques, and diverse museums.
- Saint-Jean-Cap-Ferrat: This petite peninsula is the address for some of the Riviera's most luxurious estates and also offers upscale dining options and serene beaches with panoramic views.
- Saint-Tropez: Famed for its pristine beaches and dynamic clubs, Saint-Tropez is a haven for entertainment seekers but also has developed into a family holiday destination.
Now to the good stuff....
FINANCING FOR FOREIGN NATIONALS
Problem: Securing financing for Foreign Nationals to purchase property in France has always been difficult - time zone, language, lack of understanding for both lender and borrower, and other issues. Most banks and financing institutions are not focused on Foreign Nationals as the domestic market is strong, and they have enough business to satisfy them.
The GMG Solution: Our GMG European Lender Acquisition team has worked with a few smaller private banks to create a financing solution for our international clientele with a structure that suits their specific needs.
ELIGIBILITY AND REQUIREMENTS
For Foreign Nationals seeking finance in this exclusive domain, banks have set specific benchmarks to evaluate potential candidates.
1. Geographical Preference
- Prime Locations: It's imperative for the property in question to be situated in sought-after areas. This encompasses regions such as Paris, leading stations in The French Alps, and The French Riviera.
- Emerging Desirability: The South West has been gaining traction recently, making it an area of interest for Private Banks.
2. Property Type
- Prospective properties should fall under categories such as: Luxury Apartments, Modern Residences, Contemporary Villas, Maisons de Maître, Manoirs, or Impeccably Refurbished Chateaux (case-by-case basis).
3. Loan Size
- Minimum loan amount is €1M, excluding ancillary fees.
4. Our 100% LTV Solution!
- In this structure, the client will invest a portion of funds equal to 30-50% of the loan amount into an interest-earning product.
- In return, the bank will finance 100% of the purchase amount of the property (excluding fees)!
- Client earns investment income, which may be more than the interest paid on the mortgage = positive carry.
5. Age Bracket
- Applicants should be no older than 65 years at the submission time, with a preference for those below 60.
6. Financial Overview
- Generally, the focus is on High Net Worth (HNW) individuals, specifically those boasting a net valuation exceeding €2M. Liquid assets or readily available cash remains a pivotal factor in discussions.
HOW IT WORKS
Purchase price: €1,000,000
Loan amount: €1,000,000 (100% LTV)
Interest rate: 4.50%
Loan duration: 20 years
Loan type: Principal + Interest
Investment amount: €500,000 (50% of loan amount)
Investment return: 4.50% Compounded
The 100% LTV mortgage
€1,000,000 @ 4.50% for 20 years
= Total mortgage interest PAID = €518,359
The interest-earning investment for 50% of loan amount
€500,000 investment @ 4.50% “Compounded” for 20 years
= Investment value end of Year 20 = €1,205,000 - €500,000 principal
= Total interest EARNED = €705,000
€705,000 EARNED - €518,359 PAID
= Net POSITIVE cash flow = €186,641
That is to say, the bank will give you a positive carry-trade for using their mortgage, and not only is the mortgage FREE, you MAKE money!
THE PURCHASE PROCESS
Navigating property acquisition in France is smoother with the guidance of a property buyer's agent familiar with the region and the nuances of French property transactions. Once you've found your dream home, the steps are as follows:
- Proposal Submission: You'll submit a written proposal. This will be forwarded to the property owner for a response. If the proposal gains approval, both parties – the buyer and the seller – will endorse the 'Compromis de Vente.' This preliminary agreement outlines the property specifics and the sale terms. As the transaction progresses, especially during conveyancing, certain terms in this contract might undergo modifications.
- Reflection Window: Following this, there's a 10-day cooling-off window. During this phase, should you reconsider the purchase, you can withdraw without repercussions. Specifically, the 5-10% earnest money you've placed as a deposit is fully refundable.
- Financing Initiatives: At this juncture, the financial groundwork commences (details above).
- Conveyancing Phase: Post cooling-off window, the conveyancing phase kicks off. This process, extending up to three months, involves a series of property evaluations, all supervised by the notaire.
- Finalization: After a thorough review and addressing any reservations, the concluding payment is made to the notaire. Subsequently, both parties validate the 'Act de Vente,' essentially the property's title deed.
In conclusion, owning a home in the South of France is now achievable for non-residents with our new GMG Luxury France Mortgages! I hope I get an invite to visit you one day!
Global Mortgage Group offers innovative financing solutions to meet the diverse needs of our global clientele, including Overseas Expats, Foreign Nationals, Family Offices, Investment Funds, High-Net-Worth Clients, and Private Banks. Contact us at [email protected] to start your Riviera investment journey today!