Help / F.A.Q
Please click on the following links to review the answer.
Property Schemes
-F.A.Q: What is a leaseback?
-F.A.Q: What is a buy to let?
-F.A.Q: Can I buy a buy to let property and keep it for myself?
-F.A.Q: How do I get the VAT back on a leaseback?
-F.A.Q: Is the VAT refund the same on new and refurbished properties for leasebacks?
-F.A.Q: Is there a VAT refund on schemes other than the leaseback?
Purchasing a property in France
-F.A.Q: Do you have staff able to assist me with French translations?
-F.A.Q: Will you assist me with paper work and correspondence?
Mortgages and finances
-F.A.Q: Can the bank advance the money for the stage payments when buying off the plans?
-F.A.Q: Does it cost any thing to set up a French mortgage?
-F.A.Q: How long can I take a fixed mortgage for?
-F.A.Q: On a leaseback, can I borrow based on the price including VAT or excluding VAT?
-F.A.Q: What is the maximum I can borrow with a French bank?
-F.A.Q: What type of mortgages are on offer?
Legal Requirements
-F.A.Q: What is a Notaire?
-F.A.Q: What is Frais de Notaires?
A lease back is a property which you purchase and then lease back to a management company, the lease is for a determined number of years. Leaseback include VAT refund, guaranteed rental income and possible occupancy. You find further information on the page "leaseback explained"
The buy to let is the classic way to purchasing a property and then letting it out.
The buy to let includes a guaranteed rental income and leases of 3 years at a time.
You will find more information on the page "buy to let explained"
-Can I buy a buy to let property and keep it for myself?
Yes, all buy to let properties are also available without a lease.
-How do I get the VAT back on a leaseback?
When selling a property we appoint a accountancy firm which will be in charge of collecting the VAT on your behalf, it usually takes about 6 months to come through
-Is the VAT refund the same on new and refurbished properties for leasebacks?
The amount of VAT charged on a property is different on new and refurbished properties. The VAT charges and refunded on a new property is at 19.6%. The VAT charged and refunded on a refurbished property depends on the amount of refurbishment carried out and therefore varies depending on the property. Either way the rental income is calculated on the property price EX VAT and therefore is based on the cost of the property to you.
You will find further information on this on the page "leaseback explained"
-Is there a VAT refund on schemes other than the leaseback?
No, VAT refund applies to the leaseback only
-Do you have staff able to assist me with French translations?
We can offer assistance with French paper work and offer verbal translations. For technical or legal documents we can recommend a Dublin firm which will be able to provide you with certified translations.
-Will you assist me with paper work and correspondence?
Yes we will assist you in non legal documents with verbal translations throughout the purchase process, we have bilingual staff in our offices which will assist you in any way they can.
-Can the bank advance the money for the stage payments when buying off the plans?
Yes the banks will advance the payments of stages, you can ask to only start repaying once the property has been handed over, there is however a cost to it as you will have to pay interest on the funds advanced.
-Does it cost any thing to set up a French mortgage?
Yes there is a cost of approximately 2 to 2.5% to set up a mortgage, the mortgage itself is often offered with very competitive rates which can balance out the initial cost over the years.
-How long can I take a fixed mortgage for?
Usually 20 years but it possible in many cases to borrow on interest only for up to 25 years.
-On a leaseback, can I borrow based on the price including VAT or excluding VAT?
It is possible to borrow on the cost of the property ex VAT and ask the bank to advance the cost of VAT until it is refunded by the government. Borrowing on the cost including VAT will allow you to use the refund of VAT either to build up your property portfolio or to lower your monthly repayments by placing the money. This should however be reviewed on the case by case bases as the banks may only offer one option.
-What is the maximum I can borrow with a French bank?
French banks will allow you to borrow si generally up to 80% of the property price. The limit you can borrow in relation to your earnings is more complex to calculate, overall a bank will not let you go over 1/3 of your salary in repayment, this includes repayment from other loans and mortgages if applicable.
-What type of mortgages are on offer?
Variable rates mortgages, variable rates capped, in other word with a limit to how high the interest rate can rise, fixed rate mortgages, usually for up to 10 years and interest only mortgages.
A notaire is a "French solicitor", you will need a notaire to purchase your property in France, we can recommend several English notaires in France.
The frais de notaire is the fees relating to the purchase of the property, they include the actual fees for the notaire and a number of fees and levies that the sellers’ notaire will repay to the government, Frais de notaire are usually between 3 and 3.5% for new properties and higher for refurbishments.