Equity Release in France: Unlock Cash from Your Property

Equity release in France is the process of converting part of the value of a property you own into available cash, without selling it. Two regulated solutions exist. If you are a tax resident in France, a mortgage-backed loan lets you borrow up to 70% of your property value while keeping full ownership. If you are domiciled abroad, or do not meet the income criteria, a deferred-price sale may apply provided you are selling. PraxiFinance, specialist in property-backed finance in France since 1990, structures both.

Which solution applies to you

You are a tax resident in France: the mortgage-backed loan

A secured loan using your property as collateral. You receive a lump sum and repay over time. Ownership never changes hands. The notary registers a mortgage lien as a guarantee.

Eligibility: you live in France and are a tax resident in France; your property is in metropolitan France and worth at least 300,000 euros; you 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, not through an SCI.

Rate: 5.7% per year for an amortising loan, up to 25 years. 6% per year for an interest-only structure, up to 15 years. Arrangement fee: 8.5% of the amount borrowed.

Worked examples

Property worth 1,000,000 euros, loan of 200,000 euros over 25 years at 5.7%. Monthly repayment 1,252 euros. Arrangement fee 17,000 euros, so you receive 183,000 euros.

Property worth 300,000 euros, loan of 100,000 euros over 10 years at 5.7%. Monthly repayment 1,095 euros. Arrangement fee 8,500 euros, so you receive 91,500 euros.

You live abroad, or you do not meet the income criteria: the deferred-price sale

If you are selling your French property, or intend to sell it, you can receive part of the money now rather than waiting for a buyer. The property is sold to an investor at an agreed price below market value. When it is resold on the open market, you receive the difference, 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. See the deferred-price sale simulator.

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Why residence matters so much

French banks lend against French property to French tax residents. Foreign banks do not lend against foreign assets. A bank cannot easily assess, or enforce against, income earned in another jurisdiction.

This is why a non-resident owner cannot obtain a mortgage-backed loan on a French property, whatever its value. It is structural, not a matter of documentation. See non-resident mortgage in France and can foreigners release equity in France.

Income is assessed, not just the property

A frequent misunderstanding. 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 household income must be at least three times that repayment, with a floor of 4,000 euros per month.

A valuable property with insufficient income will not obtain financing.

How the French framework protects you

Unlike the UK model, where equity release is a commercially marketed retail product, the French framework sits within the Civil Code. Every operation is authenticated by a notary and recorded in the national land registry.

Ownership never changes hands in a mortgage-backed loan. The deed registers a financial claim on the property, nothing more. See safe equity release in France.

Who uses equity release in France

Owners who are asset-rich but cash-constrained. Typical situations include settling an inheritance or a divorce, covering a tax liability, funding renovation, providing working capital for a business, or bridging the purchase of a new property before the current one is sold.

See property rich but cash poor in France, get cash from property in France, unlock property wealth in France and release equity from a French property.

Why release equity instead of selling

Selling means losing both the property and any future appreciation. It is irreversible. Equity release preserves your home and your estate while giving you access to liquidity.

If you have already decided to sell and simply need funds before completion, the deferred-price sale is the appropriate route. See what to do if your property is not selling in France.

Case study

John and Margaret are British citizens. They have lived in Provence for years, are tax residents in France, and own their villa outright. They wanted to help their children financially and buy a boat. Their bank declined a standard loan because of their age.

PraxiFinance structured a mortgage-backed loan of 300,000 euros secured on their villa. They remained full owners, used the funds as they wished, and kept the property in their estate.

The key point in their file was not their nationality. It was that they live in France, pay tax in France, and their income covered the monthly repayment. A British couple living in London, owning the same villa, would not have been eligible.

Timeline

Eight to ten weeks on average from first contact to release of funds. Initial eligibility assessment, independent valuation, structuring and presentation to partner banks, drafting of the notarial deed, signature, transfer of funds from escrow.

See how equity release works in France.

Example calculation

Costs and points to anticipate

The arrangement fee is 8.5% of the amount borrowed. Valuation and notarial costs apply in addition. Early repayment triggers a standard penalty. The valuation may come in below your expectation, which reduces the amount available.

PraxiFinance discloses every cost in writing before signature.

About PraxiFinance

PraxiFinance has specialised exclusively in property-backed finance since 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 handle files for international owners resident in France.

Call +33 1 85 09 70 40 to check your eligibility.

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FAQ

Can foreigners use equity release in France?

A mortgage-backed loan requires French tax residency, whatever your nationality. A British citizen living in France and paying tax in France is eligible. A French citizen living in Dubai is not. If you live abroad and are selling, a deferred-price sale may apply.

Do I keep my home?

Yes. With a mortgage-backed loan, ownership and occupancy remain yours. The property simply secures the operation.

How much can I release?

Up to 70% of the appraised value, with a minimum of 100,000 euros borrowed and a minimum property value of 300,000 euros.

What is the interest rate?

5.7% per year for an amortising loan, 6% per year for an interest-only structure.

Is my income assessed?

Yes, for a mortgage-backed loan. Your household income must be at least 4,000 euros per month and at least three times the monthly repayment. No, for a deferred-price sale, which is assessed on the property alone.

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 long does it take?

Eight to ten weeks from valuation to transfer of funds.