Words: Ashley Rigg
Published: 14th October 2009
France: New hybrid mortgage product launched
French mortgage specialists, Athena Mortgages has launched a new hybrid product in conjunction with a major French bank.
The new product enables borrowers to split their mortgage amount into an interest-only section and a repayment sec tion. With a typical rate of 3%, the minimum loan amount is €300,000 and within that the minimum level for the interest-only portion is €100,000.
High end clients
The loan is targeted towards the top of the market at clients who can demonstrate they own assets such as shares and property totaling at least 150% of the loan value. The mortgage is available at 85% for second homes and close to 100% for new build lease-back property.
Commenting on the launch John Luke Busby, director of Athena Mortgages, says: "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 is perfect for investors who don’t fancy the interest-only route and wish to avoid the monthly shortfall with a repayment mortgage. It really fills a gap in the French mortgage market."
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