High-Value French Mortgages For Swiss Residents

In an ideal world, you would approach Enness to discuss property finance before you start a property search, especially given the importance of liquidity in the French property market. While there are lots of property finance options for Swiss residents and nationals, getting the best deal is often a question of who you know and how you present your case.

Logic would dictate that using a French bank for a French property purchase would make sense, and sometimes it can. However, most French retail banks are often better able to cater to lower-value property purchases and plain vanilla purchases (holiday homes with low loan-to-value taken out by a borrower with a very significant income stream, for example). Mortgages over the million-euro mark can be tricky for these lenders particularly if you have global assets or multiple income streams you’d like your lender to consider in relation to how much you can borrow.

When it comes to French property, the very best mortgage rates and terms are generally offered by a few, highly select lenders. These institutions are both French and international, and the best lender for you will depend on your personal situation and financial background – many specialise in particular scenarios or can cater particularly well to certain types of borrowers.

High-value properties are especially in demand in France, particularly so in the most desirable locations (namely the Côte d’Azur, Paris and the Alps). Buyers looking to proceed with property sales without in principle offers can struggle to find a lender that can assure finance as quickly as the seller would like. The higher value your property, the harder it will be to secure a significant French mortgage in a short period of time – planning ahead is imperative wherever possible.

Not every lender – including private banks – can offer French mortgages. Approaching lenders individually will be time-consuming, and there will be no way to ensure you have the best deal. Acting exclusively in your best interest at every stage of the transaction, Enness has access to more than 500 lenders and your broker can search the entire marketplace to secure the best rates and terms for you.

If you are based in Switzerland or are a Swiss national and want a French mortgage, the lender and finance package that will be right for you will depend on:

• What you are looking to borrow and for how long
• The deposit you are able to put down
• Your openness to place assets under management with lenders if doing so will get a more competitive deal
• Your income and the currencies your income is derived in
• Your assets and their location
• How liquid you are

Enness’ brokers will work with you to assess your requirements and assets. Then they will be able to approach lenders. It’s important to note that there are no ‘ideals’ for your situation and requirements – some borrowers don’t want a new relationship with a private bank, others have significant assets but relatively little liquidity. Enness will be able to cater to all situations and scenarios.

There is a fair amount of lender rivalry at the top of the French mortgage market, which often opens the door to negotiating highly advantageous property finance. Rather than purely aiming for the lowest-price mortgage, however, Enness will also negotiate mortgages that meet your other requirements. A lender that offers flexibility, the terms you want and will let you borrow for the length of time that is most practical to you is often on a par with price in terms of priority.

Enness will always aim to deliver competitive rates and terms to you, based on your requirements and needs. Enness has access to all the lenders that offer French non-resident mortgages. Your broker will help you to secure a French mortgage quickly, simultaneously maximising how much you can borrow and reducing overhead mortgage costs as much as possible. With access to more than 500 lenders, Enness knows exactly which creditors to approach, and, depending on your situation, if it will be more advantageous for you to borrow from domestic or international lenders. If necessary, Enness will be able to structure French property finance and build a mortgage vehicle that is as tax efficient as possible, alongside your advisors.

If you are a French expat living in Switzerland, obtaining a mortgage in France remains complex despite the fact that you are a French national. You will want to plan and structure your property finance carefully, and you will likely be obliged to reveal your worldwide income and expenditure to lenders.

France’s domestic lenders typically allow French expats to borrow up to about 80% of the property’s value, up to about €5 million – for higher value loans, you will most likely be better served by international lenders or private banks. Again, careful structuring and negotiations will be paramount to ensure you can maximise what you are able to borrow and get the most competitive mortgage.

Private banks can offer some of the most competitive mortgages for French property, especially if you are looking to buy ultra-prime property which comes with a significant price tag. Where France’s retail banks have rigid underwriting processes, private banks are usually able to take a more holistic view of your wealth. The way that private banks will assess your situation and the affordability of the mortgage is usually beneficial if you have significant assets in various countries, multi-currency income, if you have a high net-worth but little liquidity or if you have an unusual background or situation.

Most private banks will require that you put assets under management in return for a mortgage. There are exceptions, but these will have to be negotiated on a case-by-case basis, and your ability to access a ‘dry’ mortgage (with no assets under management) for a private bank will depend on your background, wealth and profile. For more expensive French property purchases, private banks will tend to require assets under management as standard.

How much you will need to put forward will depend on the property you are looking to buy, what it costs and how liquid you are. There is no universal standard for how much banks will require borrowers to pledge, but assets under management totalling between 20% and 50% of the property price is usual. However, placing assets under management in return for a mortgage often offers an array of advantages from more competitive rates to increased flexibility and sometimes, the ability to borrow more.

Your mortgage broker will advise you if a private bank mortgage is the right option for you and will advise you on the type of assets you might want to use as collateral and when you should request equity release along the way. With access to French private banks, Swiss private banks and international players, Enness will also suggest and approach the institutions which offer the French property finance that meets your needs.

Given Switzerland’s proximity to France and the potential returns on developed property, buying French property to develop is a popular choice for Swiss residents and nationals.

Wherever you are looking to develop a property and whatever the scope of your project, Enness will be able to source and negotiate development funding. With contacts all over France and from international institutions who have an appetite to lend in France or in cross-border transactions, Enness can source high-value development funding.

For many Swiss residents and nationals buying a French property, a mortgage makes sense from a fiscal and cash planning perspective. Mortgages have always been popular for French buy-to-let properties, and over the past decade, there has been a significant rise in the number of non-resident investors using mortgages for holiday homes, second homes and other property investments.

French property is some of the most desirable in the world and it has a price tag to match. Prime French real estate can easily cost in excess of 1 million euros, with prices in Paris, the Côte d’Azur and popular mountain regions often running at significantly higher prices. As a result, even high-net-worth Swiss-based investors tend to opt for mortgages to buy French property. Planned alongside your advisory team, mortgages can be tax-efficient and ensure you retain liquidity for other investment opportunities, purchases or requirements.

Leading banks and non-bank lenders recognise the opportunities in the French property market and there is an abundance of mortgage products on the market for non-resident borrowers. Both domestic and international lenders offer mortgages for Swiss residents and citizens. In particular, international private banks and niche lenders can offer the most competitive loans, especially compared to France’s high street lenders who tend to offer package deals.

French lenders - especially retail banks – typically enforce very strict loan-to-value ratios and will monitor affordability very closely. Your liquidity and income will be paramount for these lenders, and while these mortgage providers are not ideal for every borrower, there are some great deals to be had if you have a significant deposit or need a low loan-value-loan mortgage.

If you have multiple income streams, generate multi-currency revenue and hold global assets, France’s retail banks will find it harder to cater to you for a high-value loan. Both international lenders and private banks have been keen to offer international investors - particularly Swiss residents - French mortgages. These institutions will be able to assess your worldwide income, assets and wealth to determine affordability, which usually positively impact how much you can borrow.

Parisian property has always been popular with non-resident investors, particularly the Swiss. Buying in a neighbouring country will always be appealing, and the French property purchase process is similar to that of Switzerland, which often makes purchasing property easier to understand than somewhere like London, where things move a little differently.

High-value properties in Paris remain in high demand for non-resident investors either for personal use or as buy-to-let opportunities. Parisian buy-to-let investments are popular with Swiss investors, and a well-thought-out Parisian property purchase can generate a steady and lucrative income.

If you’re thinking of buying in Paris, it’s important to understand the speed with which the market moves. The best properties in the most desired locations – even those costing several million euros – come and go off the market exceptionally quickly. ‘Bargain’ property, should you come across it, will move off the market even faster. The intense competition for Parisian real estate means that sellers have their pick of buyers. Having the property finance lined up that will allow you to buy property is imperative, especially so for non-national buyers for whom securing a mortgage may be slightly more complex than for domestic buyers.

Many international buyers will opt for mortgages when buying French real estate. Competitively priced mortgages and other property financing products are readily available for Parisian property purchases, although domestic retail banks typically don’t lend to non-residents. Generally speaking, the buoyancy of Paris' real estate means that French mortgages for non-residents are more readily available than in the other parts of France that also attract foreign investors.

While there are many options for financing a property purchase in Paris, you should note that French mortgages can be complicated for Swiss nationals or resident investors. Highstreet French banks do lend to French non-residents, but the application process is often long and complex. Seeking a mortgage from these players is complex if you are operating alone, hopping from lender to lender in search of a finance package while simultaneously trying to navigate a property search away from home.

You’ll also find that mortgages from domestic retail banks tend to be standardised and won’t provide the most competitive rates and terms. Enness will be able to negotiate property finance from lenders who can consider global income and assets, structure Parisian mortgages effectively from a tax perspective and mitigate exchange risks between the euro and the Swiss franc.

The French Riviera is one of the most popular regions for Swiss residents and nationals to buy property. Second homes, holiday homes and investment properties are all popular choices. Given the very significant prices of property in the region and the need for quick access to liquidity in the competitive market, mortgages are increasingly used for high-value property purchases in the area.

There is significant competition for the best properties on the Côte d’Azur and liquidity is paramount to a successful sale. Many Swiss buyers seek in principle offers before they start their search, however, Enness can also secure property finance quickly if you find a property you would like to buy before you’ve considered financing options.

Property prices have appreciated significantly in the Côte d’Azur over the past ten years and the trend looks set to continue. For Swiss buyers, the region provides solid investment opportunities and securing mortgages tends to be relatively straightforward, given lenders feel comfortable lending against property in the region.

France’s luxury chalets in the Alpine ski resorts are popular amongst Swiss buyers. As well as using them for your own enjoyment, an astute property purchase can provide lucrative income streams if they are rented. The Alps have year-round appeal, and although rentals in winter tend to be more popular, generating income in the summer months is also possible with a property management team that can market the property.

Luxury new-builds in the Alps are particularly sought-after, but they can be few and far between. As a result, there is also considerable demand for development projects where owners can renovate a property.

Anyone looking for property in the French Alps should expect competition, especially in the most famous and popular resorts. France’s retail banks, Switzerland’s private banks and international lenders are able to offer property finance for Swiss non-residents buying French property, and with Enness to support you, you will have a choice of lenders. High loan-to-value mortgages and dry mortgages can both be possibilities, although how you present your case will be critical.