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A mortgage-backed loan is a secured credit facility in which a French property you already own guarantees the financing. You borrow up to 70% of the property value, keep full ownership, and continue to live in the property or rent it out. PraxiFinance, specialist in property-backed finance in France since 1990, structures the file and presents it to its partner banks.
Eligibility criteria
You are eligible if all of the following apply.
You are a tax resident in France and you live in France. Owners domiciled abroad are not eligible.
Your property is in metropolitan France and is worth at least 300,000 euros.
You want to borrow at least 100,000 euros, up to 70% of the property value.
Your household income is at least 4,000 euros per month, and at least three times the future monthly repayment.
The property is held in your own name. Properties held through an SCI are not eligible.
Income is assessed, not just the property
This point is often misunderstood. The property secures the loan, but it does not replace income. A partner bank will always verify that you can service the monthly repayment. Your income must be at least three times that repayment. A valuable property with insufficient income will not obtain financing.
Types of mortgage-backed structures
Rates, fees and duration
The interest rate is 5.7% per year for an amortising loan, and 6% per year for an interest-only structure.
The arrangement fee is 8.5% of the amount borrowed, in both cases.
The duration runs up to 25 years for an amortising loan, and up to 15 years for an interest-only structure.
Worked examples
Property worth 1,000,000 euros, loan of 200,000 euros over 25 years. Rate 5.7% per year. Monthly repayment 1,252 euros. Arrangement fee 8.5%, or 17,000 euros, so you receive 183,000 euros. Loan-to-value 20%. Required household income: at least 4,000 euros per month.
Property worth 300,000 euros, loan of 100,000 euros over 10 years. Rate 5.7% per year. Monthly repayment 1,095 euros. Arrangement fee 8.5%, or 8,500 euros, so you receive 91,500 euros. Loan-to-value 33%. Required household income: at least 4,000 euros per month.
To model your own situation, use the mortgage-backed loan simulator.
The two structures
Amortising loan
Each monthly payment includes capital and interest, gradually reducing the balance. Rate 5.7% per year, duration up to 25 years. Predictable, suited to owners seeking long-term stability.
Interest-only loan (in fine)
You pay interest during the term and repay the capital in a single transaction at maturity, often from an asset sale. Rate 6% per year, duration up to 15 years. Suited to owners with a scheduled exit.
For a comparison with refinancing an existing bank loan, see equity release vs remortgage in France and refinance your property in France.
How the process works
An independent expert determines the market value of the property. PraxiFinance then structures the loan and presents the file to its partner banks. All parties sign an authentic deed before a French notary, who registers the mortgage in the land registry. Funds are wired from the notary's escrow account to yours.
Average timeline: eight to ten weeks from initial consultation to release of funds. Document collection and valuation take seven to ten days, structuring one week, notarial drafting and signature two to three weeks.
For more detail, see how equity release works in France.
What the funds can be used for
There is no obligation to justify the purpose, provided it is lawful. Owners commonly use a mortgage-backed loan to settle a tax liability, equalise an inheritance, fund a divorce settlement, finance renovation, provide working capital for a business, or bridge the purchase of a new property before the current one is sold.
See get cash from property in France and need cash urgently in France.
If you live abroad
If you are domiciled abroad, both fiscally and physically, borrowing against your French property is not available to you. French banks lend against French property to French tax residents. Foreign banks do not lend against foreign assets. No amount of documentation changes this.
There is, however, one solution built for exactly this situation.
If you are selling your French property, or intend to sell it, a deferred-price sale lets you receive an advance now rather than waiting for a buyer. The property is sold to an investor at an agreed price below market value, and you receive the funds immediately. When the property is resold on the open market, you receive the difference between the resale price and the initial price, less the investor's fee.
It is assessed on the property, not on your income. Your country of residence is not an obstacle. A deferred-price sale can also be structured on a property held through an SCI, unlike a mortgage-backed loan.
Eligibility: the property is in metropolitan France and worth at least 300,000 euros, held in your own name or through an SCI, and you are selling or intend to sell.
See non-resident mortgage in France and the deferred-price sale simulator.
Can I use a property held through an SCI?
Not for a mortgage-backed loan. Properties held through an SCI are eligible for a deferred-price sale.
Why this solution exists in France
France permits private mortgage financing under a civil-law system supervised by notaries. Every mortgage is registered in the land registry. This guarantees traceability, prevents fraud and protects heirs. The same regulatory discipline governs safe equity release in France.
You remain the full legal owner throughout. The notary registers a mortgage lien as a guarantee. Ownership never changes hands.
Points to anticipate
Interest payments require budgeting. The arrangement fee of 8.5% is charged on the amount borrowed. Early repayment triggers a standard penalty. Loan-to-value is capped at 70%, and the valuation may come in below your expectation.
PraxiFinance operates on full fee disclosure. The notarial deed lists every component before signature.
H2: About PraxiFinance
PraxiFinance is not a bank. It is a specialist intermediary dedicated to property-backed finance, established in 1990, with offices in Paris and Nice. The firm is registered with ORIAS under number 13005512 and operates within the regulatory framework of the ACPR.
It processes more than 4,000 financing requests per month and publishes the only recurring barometer of the French property-backed lending market. It is regularly cited as a market reference by Les Echos, La Tribune, Le Monde and BFM. See best equity release companies in France.
English-speaking advisers coordinate with notaries and valuers for international owners resident in France. See equity release in France and borrow against property in France.
Call +33 1 85 09 70 40 to check your eligibility.
FAQ
How much can I borrow?
Up to 70% of the property value, with a minimum of 100,000 euros and a minimum property value of 300,000 euros.
Can non-residents apply?
No. A mortgage-backed loan requires French tax residency. If you live abroad and are selling your property, a deferred-price sale may apply.
Is the decision based on my property alone?
No. Income is assessed in full. Your household income must be at least 4,000 euros per month and at least three times the monthly repayment.
What is the interest rate?
5.7% per year for an amortising loan, 6% per year for an interest-only structure.
What are the fees?
8.5% of the amount borrowed, for both structures.
How long does the process take?
Eight to ten weeks from consultation to release of funds.
Can I use a property held through an SCI?
Not for a mortgage-backed loan. Properties held through an SCI cannot be used as security for this type of financing. A deferred-price sale, however, can be structured on a property held through an SCI. If your property is held this way and you are selling, this route remains open to you.
How is this different from a remortgage?
A remortgage replaces an existing bank loan. A mortgage-backed loan releases new liquidity from a property you already own.
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