The amount you can borrow is based upon your ability to service the loan. The general guideline being that of a monthly income, 33% should cover existing outgoings, the monthly repayment of the new mortgage and life assurance cover. For UK tax payers use gross monthly income. For French tax payers use gross monthly income less social charges, do not deduct tax.
If you are employed, the lender will base income on evidence of payslips and the amount credited to your bank account on a monthly basis.
If, however you are self-employed, your income is assessed from your accounts as the average on the last three years net income.
Additional income from pensions or rentals will also be taken into consideration.
Lender's Arrangement Fee
The mortgage lender will also charge an arrangement fee. Each lender has a different scale of fees, but generally charge 1% of the total mortgage subject to a minimum and maximum charge.
Another requirement is to take out a life assurance policy for the duration of the mortgage with a life assurance company approved by the lender. Life assurance to cover a mortgage is mandatory in France.
Buildings and contents insurance need to be in place on completion of the purchase.
Your notaire will ensure that all the necessary legal work is complete and that you have been granted a mortgage as well as having your life assurance and buildings and contents insurance in place before the deed of sale (Acte Authentique de Vente) is signed..