Athena Mortgages launches Next Generation Hybrid French Mortgage

Athena Mortgages has launched a ‘next generation’ hybrid French mortgage product in conjunction with a major French bank. The new product, exclusive to Athena Mortgages, and with a typical rate of 3%, enables borrowers to split their mortgage amount into an interest-only portion and a repayment portion.

This is an evolution of the traditional hybrid mortgage structure in France, which sets out an interest-only period for a number of years followed by a defined repayment period until the end of the loan. The minimum loan amount for the product is €300,000 and within that the minimum level for the interest-only portion is €100,000.

The loan is targeted at higher net worth individuals, who must be able to show assets in stocks, investments or property totalling at least 150% of the loan amount (e.g for a €300k loan, borrowers must have €450k in net equity across their portfolio). The loan is available at 85% for second homes and practically 100% for new build leaseback properties.

John Luke Busby, director of Athena Mortgages, comments:
“This mortgage is completely new for France and a real innovation at this level of borrowing. The flexibility offered means borrowers can set a target payment amount that is somewhere between the low cost offered by an interest-only mortgage and the higher cost of a repayment mortgage. The mortgage also acts as a hedge on the investment, enabling equity to be built up as a portion of the loan is repaid.”

Matthieu Cany, managing director, French estate agents network, Sextant Properties, adds: “The hybrid structure is perfect for investors who don’t fancy the interest-only route but who wish to avoid the monthly shortfall with a repayment mortgage. It really fills a gap in the French mortgage market.”

An example calculation for the mortgage using €300k loan with rates of 3% gives:

Repayment: €1422
Interest-only: €750
Hybrid 50/50 split: €711 (Repayment over 25 years) + €375 (Interest-only) = €1086

Athena Mortgages is a specialist French mortgage broker offering French mortgages from a large panel of French lenders. An integrated team of multilingual professionals, with twenty years of experience in buying French property, helping thousands of non-residents and ex-pats find the right mortgage, release equity in their French home, or remortgage their property, from abroad.

Offering the highest level of service, Athena Mortgages bring a human face to a process that can seem intimidating. Working closely with many French property developers who choose them for the clarity and simplicity of presentation they provide to their clients. They pride ourselves on professional service and dedication to finding the best offer until the date of signature. They are happy to welcome clients at our offices in London and Paris and can be contacted at their website, website, or by telephone +44 (0) 207 474515

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