The French banks are getting anxious because of a new law that will require the banks to make changes in how they will serve the French real estate property buyer using a French Mortgage.
This French law connected to European law is to come into effect by July 1st 2016 and the banks feel they do not have enough time to prepare.
Sample of Pros and Cons for the consumer
Pro
The bank will be required to educate more the consumer on the nature of the credit including using a standardized information form. This will enable the buyer to compare more easily credit that is being offered by different banking institutions.
Con
Buyers may be required to have an evaluation of their property prior to receiving credit. This could mean that a buyer who wants to borrow 200 000 Euros to buy a property with 100 percent financing and the property is appraised to be worth only 160 000 Euros. The buyer will have to make a down payment of 40 000 Euros to cover the difference.
This negative in our opinion is a positive since it will help French real estate buyers avoid buying over priced property.
Find out more details about these changes with the guidance of an English speaking French mortgage broker. Contact us here for guidance to a specialist in your area.