The amount which can be borrowed is fixed by law according to the youngest age of the borrowers. Whilst these borrowing amounts and bands are:

to age 70 - 18% of the property value
to age 75 - 25% of the property value
to age 80 - 34% of the property value
to age 85 - 44% of the property value
to age 90 - 53% of the property value
to age 95 - 61% of the property value

... it should be noted that the actual loan receivable can be a not inconsiderable lesser sum.  There are a number of reasons for this, some of which are:

Those affecting the property value:

• the actual valuation of the property given by the lender
• the area and surrounding location of the property
• the likely impact of future property or other developments in the area
• the state of the property now, and the influence of time on this state

Those affecting the percentage amount lent:

• whether the husband is the elder of the spouses, and ...
• ... the age gap between the spouses

Financial costs:

• the application fee of 4%
• the notarial fees for putting the property under a mortage, which vary according to the value of the property (but possibly around 1%)

Accordingly, the larger the borrowing, the more likely it is that the loan and accumulated interest will, at the time of the second of the owner's deaths, be in excess of the value of the property.

It should also be noted that it takes some time for one of these mortgages to go through to fruition, given the searches and verifications that need to be performed and especially for foreign nationals, usually resulting in a time span of some four to five months being required.

There is currently only one major lender in France offering these equity release schemes, themselves underwriting schemes for other organisations such as banks, but The Annett Consultancy can offer the full range of these and other mortgages, so contact us for further details on 04 90 38 66 01 or use the enquiry page.