Why ‘NOW’ is the best time to re-finance your French mortgage?
The latest National Mortgage Index from Mortgage Advice Bureau claims remortgage applications for fixed rates have increased by 15.8% since the beginning of the year. In France, French mortgage rates are approaching historic lows with the average fixed rates mortgages at levels not seen since the end of 2005. 
Not only have prices contracted by 12% or more in many locations, mortgage rates are at an all-time low as well. The average rate on a 20-year-fixed rate mortgage is 3.60% and 3.40% on a 15-year fixed-rate mortgage.
Those who hesitate, often lose! It is an old saying, and right now, it is very much applicable. Yes, the economic headlines are still uncertain, but paradoxically these are creating one of the best re-mortgaging opportunities. This autumn shows an increase in term of new applications. There has never been a better time for non-residents to re-mortgage their French property. Combine low rates and low prices and you have an incredible chance.
It is worth mentioning too that exchange rates are also very favourable right now; therefore, if you spot a great mortgage rate, it might be wise to fix it and re-mortgage.
Currently, there are 11.24 million outstanding mortgages in the UK: with one in ten an Interest only loan. This is a big issue for lenders; the majority of these property loans have no repayment vehicle. Consequently, should lenders fail to help borrowers find a repayment plan; many of them will go in the red. One of the solutions, especially for those who possess a property in France, is refinancing their loan with a French mortgage.
It is important to note that in France, your fixed rates remain consistent for the whole period of your loan. In other words, if you take a loan today for 20 years, your rate will not change until 2032! This makes property in France a robust investment option over the long term.
There are several reasons why mortgage rates are so affordable:
Most French banks price their variable rates of the Euribor (Euro Interbank Offered Rate) rate. The 3 month euribor (on which the majority of the French variable rates are based) was at 0.64% in September 2010. Two years later, the 3 month euribor decreased almost three times! (0.220% on 28th September 2012 ).The second reason is the decrease of the French bonds (OAT over 10 years) which were at a rate of 2.19% in September 2012. Fixed rates offered by French banks are following the OAT and that is the main reason why they are so interesting at present.
Finally, French banks are lending up to 85% loan to value (LTV) which makes loans more affordable than ever! Combine the above with the fact that rates are so low – you get the best time for UK investors to re-mortgage their French homes or for them to buy a holiday home in France.
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