How do mortgages work in France in 2026? The complete guide
A mortgage in France is a loan granted by a bank to finance the purchase of a home, repaid in monthly installments over a maximum term of 25 years, most often at a fixed interest rate. The bank verifies that your monthly payments do not exceed 35% of your net income, a rule imposed on all banks by the High Council for Financial Stability (HCSF). As of June 2026, the average interest rate is approximately 3.47% over 20 years, according to thePretto barometer.
If you're reading this, it means you're seriously considering buying a home in France, and we understand why: the relaxed lifestyle, the incredible cultural heritage, and a real estate market that's still affordable. When viewed from abroad, however, financing can seem intimidating. We'll explain everything to you, simply and step by step.
Key points to remember
- In France, a mortgage is repaid overa maximum of 25 years(27 years for new construction) and almost always ata fixed rate: the monthly payment remains the same for the entire term of the loan.
- Your monthly payments (including insurance) cannot exceed35% of your net income: this is the legal limit set by the HCSF.
- In addition to the property price, factor in notary fees (approximately 7% to 8%) and, for foreign or non-resident borrowers, a larger down payment.
- Borrower insuranceand a security (mortgage or guarantor) are mandatory requirements for the loan.
What exactly is a mortgage in France?
It is a special-purpose loan: the bank lends you a specific amount solely for the purpose of purchasing a specific property. In exchange, you make monthly payments consisting of a portion of principal, a portion of interest, and borrower's insurance.
Two French peculiarities often surprise foreign buyers. First,fixed-rate loans are the norm: unlike in many Anglo-Saxon or Scandinavian countries, the vast majority of French mortgages are fixed-rate, so your monthly payment is known in advance and does not change. Second, the bank does not base its decision on the property’s value (the well-known “loan-to-value” or LTV ratio), but primarily on yourmonthly repayment capacity.
What are the steps involved in getting a mortgage in France?
The process follows a fairly specific sequence, and knowing it in advance will help you avoid many surprises. Here's how it unfolds, from your dream to receiving the keys.
- Mortgage simulation and borrowing capacity.Even before you start looking for a property, you should estimate how much you can borrow. This is where a mortgage broker first comes into play.
- The preliminary sales agreement (or promise of sale).Once you’ve found a property, you'll sign this initial contract with the seller. It includes acondition precedent regarding loan approval: if the bank refuses to finance your purchase, you’ll get your earnest money deposit back.
- Securing financing.You (or your real estate agent) submit your application to several banks to obtain approval and negotiate the interest rate. Generally, allow 45 days for this process, as specified in the preliminary sales agreement.
- The loan offer.The bank sends you an official document detailing the amount, interest rate, term, and total cost. You must observe a10-day cooling-off periodbefore you can accept it: this is a public policy rule, stemming from the Scrivener Law, which no one can waive (source: La finance pour tous).
- Signing at the notary's office.In France, real estate purchases must go through a notary, a public official who ensures the transaction is secure. The notary authenticates the final deed of sale.
- Release of funds.The bank transfers the money to the notary on the day of signing, and you become the owner.
How much can I borrow? The 35% rule explained
The bank calculates yourdebt-to-income ratio(also known as the debt service ratio): the total of your monthly loan payments, including insurance, divided by your net monthly income. Since 2022, this ratio cannot exceed35%, a limit imposed on all banks by the HCSF and confirmed in 2026 (source: economie.gouv.fr).
A concrete example: with €5,000 in net monthly income, your total monthly payments cannot exceed €1,750. It is this maximum monthly payment, combined with the loan term and interest rate, that determines the amount you can borrow.
For foreign or non-resident buyers, income in foreign currency is accepted, but the bank applies a conservative margin on the exchange rate. We cover this point in detail in our dedicated guide:Buying in France as a Non-Resident.
How much of a down payment do I need to buy a home in France?
The down paymentis the amount you contribute yourself, in addition to the loan. For residents, banks generally require about 10%, mainly to cover ancillary costs. For foreign nationals or non-residents, the required down payment is higher, often ranging from 20% to 30% of the property’s price.
In addition to this down payment, there are notary fees, which are not the notary's profit but largely consist of taxes paid to the government and local authorities. They amount to approximately 7 to 8% of the price for existing homes and only 2 to 3% for new construction (source: immobilier.notaires.fr). For an existing home priced at €300,000, you should therefore expect to pay an additional €21,000 to €24,000 in notary fees.
French mortgage lending terms explained
Don't panic when you see technical terms: here are the most common ones, explained in plain language.
- Down payment:the money you contribute from your ownfunds, in addition to the loan.
- Nominal rate:the "gross" interest rate on the loan, excluding ancillary fees.
- APR (Annual Percentage Rate):the true total cost of the loan, expressed as a percentage. It includes the interest rate, insurance, guarantee, and application fees. This is the key figure to compare when evaluating two offers.
- Borrower insurance:This reimburses the bank on your behalf in the event of death, disability, or inability to work. It is not strictly mandatory, but is required by all banks.
- Guarantee:the security the bank requires in case you stop making payments. In France, this takes two main forms:a mortgage(on the property) or aguaranteeprovided by a specialized agency, which is often less expensive.
- Loan offer:the bank's official contract, subject to a 10-day cooling-off period.
- Notary:a mandatory public official who authenticates the sale and ensures its legal validity.
- Preliminary sales agreement:the first contract signed with the seller, which reserves the property.
Fixed-rate or variable-rate: which should you choose in France?
In France,fixed-rate loansare by far the most common and the most reassuring: your monthly payment and the total cost of the loan are known from the moment you sign the contract and never change.Variable-rate loans, which fluctuate with market conditions, remain less common and are generally reserved for specific financing arrangements. For a first-time purchase—and especially when buying from abroad—a fixed-rate loan is almost always recommended for its complete predictability.
How much does a mortgage really cost?
The cost of a mortgage isn't just the interest rate. It consists of four components: theinterestpaid to the bank over the entire term,mortgage insurance, the cost of thecollateral(mortgage or guarantor), and anyapplication fees. This is precisely what the APR (Annual Percentage Rate) captures. When comparing two offers from banks, always look at the APR rather than just the advertised interest rate.
Your project starts today
Mortgages in France make sense once you understand the rules, but each bank applies its own criteria, and not all of them are open to international applicants. At Opeongo Finance, we assist expatriates, non-residents, and foreign buyers in financing their purchases in France: selecting the right banks, developing a financing strategy, and preparing a strong application. Whether you're just starting to think about it or are already actively searching, let's discuss your project, with no obligation.
Can a foreign national obtain a mortgage in France?
Yes. No French law prohibits a foreign national or non-resident from taking out a loan from a French bank. What matters is not nationality but the applicant's financial profile: stable income, down payment, country of residence, and a debt-to-income ratio capped at 35% of net income. Some banks are more open than others to international applicants, which is why working with a specialized broker is beneficial.
Is borrower insurance mandatory?
It is not mandatory in the strict legal sense, but no French bank will grant a mortgage without it. It primarily covers death and disability. The good news is that you are not required to take out the bank's insurance; you can choose another insurer (insurance delegation), often at a better price with equivalent coverage.
Can you pay off your loan early?
Yes, you can pay off all or part of your loan before it matures. The bank may then charge early repayment fees (IRA), which are regulated by law: these fees cannot exceed 6 months' worth of interest on the principal paid off, nor 3% of the outstanding principal. These fees are sometimes negotiable when you sign the loan agreement.
Why use a mortgage broker?
Mortgage lending in France involves specific rules, technical jargon, and dozens of banks with varying criteria. A mortgage broker is a professional who acts as an intermediary between you and the banks: they analyze your situation, identify the institutions that are truly suited to your profile, negotiate the interest rate and insurance, and put together a strong application to maximize your chances of approval.
For a foreign buyer, this support makes all the difference. Not all banks accept international applications, and those that do have different requirements depending on your country of residence or the currency of your income. A specialized broker is familiar with these internal policies, helps you avoid unnecessary rejections, handles the essentials remotely, and saves you a considerable amount of time. This is often the difference between approval and rejection, and between an average rate and the best possible rate.
Updated on July 2, 2026, by Paul Desjardins, mortgage broker specializing in international clients (ORIAS No. 25 010 121).
Paul Desjardins assists expatriate buyers, non-residents, and international investors with their real estate financing projects in France. More than 60% of his clients live abroad: he advises them in French and English, from the initial review of their application through to the signing at the notary’s office. He writes practical guides for Opeongo Finance aimed at international clients who want to understand the rules of French mortgage lending and secure financing from abroad.
