French lenders operate under a binding 35% maximum effort ratio and a normal mortgage term of 25 years. Those are the headline limits set by the Haut Conseil de stabilité financière. They are not, however, a promise that a bank will lend to 35%, for 25 years, to every applicant who arrives with a calculator.
This distinction catches non-resident second-home buyers. They calculate that the proposed French payment keeps total debt below the line, then assume the credit decision is largely done. The bank has barely started. It still has to decide which income counts, how much rent to recognise, what currency risk to apply, how much cash must remain after completion and whether the file fits its appetite for a customer who lives elsewhere.
What the regulator actually says
The effort ratio compares borrowing charges with net income before tax. The standard ceiling is 35%; the standard term is 25 years. Where occupation is delayed, as it can be on an off-plan purchase, the framework allows up to two additional years of repayment deferral in qualifying cases. That is why a VEFA loan can run through construction without pretending the construction period does not exist.
Banks have a flexibility margin covering up to 20% of quarterly new housing lending. At least 70% of that margin is reserved for principal-residence purchases and at least 30% for first-time buyers. The freely usable portion for other cases is therefore only 6% of total quarterly production. A non-resident buying a ski apartment should not build a plan around being the exception.
The Ministry of the Economy makes another point in its 2026 consumer explanation of mortgage credit: compliance with 35% and 25 years does not oblige a lender to approve the loan. Credit policy still applies.
A €500,000 application on paper
Take a British couple buying a €500,000 Alpine apartment. They provide a €175,000 deposit and request €325,000 over 20 years. At an illustrative fixed rate of 3.8%, excluding insurance, the repayment is about €1,936 a month. This is an example, not a current lending quotation.
They already pay €1,100 a month on their UK home and have €9,500 of net monthly household income after the bank's currency conversion and income adjustments. Add an illustrative €100 a month of loan insurance and total borrowing charges are €3,136, or about 33.0% of assessed income. The file fits under 35%.
Now change one assumption. One applicant receives £30,000 of variable annual bonus, but the French bank recognises only the two-year average and discounts it. Assessed monthly income falls. Or the couple expect €25,000 of holiday rent, but the lender counts only 70% and asks for an operator's projection. The same property, deposit and repayment can cross the line without the applicants earning a penny less in real life.
Income is edited before it reaches the ratio
A salary with a permanent contract is easy to read. Partnership drawings, dividends, retained company profit, commissions and recent self-employed income require interpretation. A bank may average several years, exclude a one-off distribution or ask why the latest year moved sharply. The applicant's gross wealth does not turn volatile income into dependable debt service.
Currency adds another edit. A sterling income funds a euro liability. Banks can apply a haircut or stress to foreign-currency income, and their methods differ. This is one reason online affordability tools produce false precision for British buyers.
Rental income is not usually counted euro for euro. The lender may recognise a percentage of evidenced long-term rent, treat projected seasonal rent cautiously or disregard it in an early-stage application. A resort forecast is useful commercial evidence; it is not a salary. Buyers should model affordability both with and without rent.
Other debt is edited too. Credit-card balances, car finance, school fees and maintenance payments may sit outside the applicant's own mortgage spreadsheet but inside the bank's affordability view. Some lenders count the contractual limit of a revolving facility; others use the current payment. Closing an unused account shortly before application does not always remove it from the documents immediately.
The result is a bank-specific numerator and denominator. Two lenders can look at the same household and calculate different ratios without either making an arithmetic error. The disagreement lies in policy: accepted income, exchange-rate buffer, rent recognition and debt treatment.
Liquidity is the second balance sheet
The deposit is not the only cash question. Lenders look at what remains after the purchase, fees, furnishing and any currency transfer. A buyer who empties every account to reach a lower loan-to-value ratio can present a weaker file than one who borrows slightly more and retains a credible reserve.
For a €500,000 resale, acquisition costs are materially higher than for a new build. The exact figure belongs in the notaire's estimate, but it must be funded alongside the deposit. On a new build, buyers may also need furniture, legal translation, valuation and mortgage costs. Domosno's new-build ski property listings show VAT-inclusive prices; the finance plan still needs a separate uses-of-funds schedule.
Investment assets can help, but availability matters. A pension that cannot be accessed is not the same as cash. A securities portfolio can fall. A pledged insurance wrapper may support one bank's structure and be irrelevant to another. Name the asset, ownership, currency and access conditions.
Keep a separate contingency for completion. Currency can move between mortgage approval and the final funds call, and a new-build developer may request stage payments on dates that do not align neatly with an asset sale. A 5% cash buffer on a €500,000 purchase is €25,000. It may never be used; that is what makes it a buffer.
Current rates are context, not your offer
The Banque de France reported an average rate of 3.27% in June 2026 for new housing loans excluding renegotiations. It also recorded 99.4% fixed-rate production. Those figures describe the French household market as a whole. They are not a rate card for non-resident second-home lending.
A British applicant may face a different rate, term, deposit and product fee. The property can also affect the decision. A conventional apartment in a liquid resort is easier security than an unusual commercial lease, a tiny studio with planning complications or a chalet carrying unresolved title issues.
Compare offers on total cost and structure, not the nominal rate alone. A lower rate tied to an expensive investment product or insurance policy may cost more overall. A longer term lowers the monthly ratio but increases interest and may run beyond the bank's preferred age at maturity.
Insurance can also affect affordability. French mortgage protection is priced separately and its coverage, medical underwriting and allocation between joint borrowers vary. A quote that excludes insurance should be labelled as such. In the €325,000 illustration above, even €100 a month of insurance lifts total monthly debt service and the ratio.
Prepare the file in the order a bank reads it
Start with identity, tax residence, family position and existing debt. Then show income with matching bank statements and tax returns. Add assets and liabilities, the source of deposit, the property, the planned use and a conservative rental case. Explain anomalies before the analyst finds them.
For company owners, prepare accounts, tax returns, organisation charts and evidence of recurring remuneration. For bonus earners, show the history. For landlords, separate gross rent, finance costs and taxable profit. A tidy file does not guarantee approval; it removes avoidable doubt.
France also gives borrowers a mandatory 10-day reflection period after receipt of a mortgage offer, described by Service-Public.fr. Build that pause into the timetable. It cannot be compressed because completion has been booked.
The practical decision
Run three calculations before making an offer: the HCSF ratio using conservative recognised income, the cash remaining after every purchase cost, and the repayment with no holiday rent. Then ask which parts depend on a bank making a favourable judgement.
In the worked case, 33.0% fits. It becomes fragile if bonus income is excluded or existing debt was understated. The useful mortgage conversation is therefore not “Can we borrow at 35%?” It is “What will this bank count, and what must remain true until completion?”
Re-run that answer before exchange, mortgage offer and completion. Income, debt and cash can change during a long Alpine purchase, especially when the property is still being built.
Domosno can coordinate the property evidence with a specialist French mortgage adviser so the application and purchase tell the same story. Contact the team before fixing the deposit or signing a reservation contract.
