This is my first post on SF so hello to all on here!
We’ve lived in France since 2005, in a beautiful house with three gites in a tourist hotspot. Bookings from the gites have been good despite the recession and continue to provide us with a manageable income. Or they would, if it weren’t for the fly in the ointment – a short-term mortgage with heavy monthly repayments. When we moved here, my husband returned regularly to the UK for work but, with the economic downturn, this income stream rapidly dried up. For the last couple of years, we’ve been dipping heavily into our savings to pay the mortgage but these are disappearing at an alarming rate.
The value of the property (on paper) is around 5 or 6 times the value of the outstanding mortgage and, with this in mind, we’ve put our property up for sale. But this will take time and time isn’t a luxury that we have. So far, our bank has shown no interest in helping us beyond vague smiles and Gallic shrugs, other than a years ‘holiday’ from the payments a couple of years ago.
My question is this: By the end of the year, we will likely no longer be able to make the mortgage repayments. Is there any alternative to the bank foreclosing on us whilst we work to sell the property and discharge our debt – giving us a breathing space. Remember that part of the property’s value is in our healthy gite business but we can’t accept bookings for 2012 against such uncertainty.
Not an unfamiliar problem, I suspect, in these straightened times but any advice would be most welcome. We have a crunch meeting with our bank in a couple of weeks, so it would be good to be forearmed. Thanks for any help.
Diana
Thank you so much, Suz. Your help is much appreciated. I’ll get in touch tomorrow when we’re back from our French lessons.
diana
I would recommend trying George Quintard at French Mortgage Advice or David Romano at Best Euro Finance to- see if there is anything either of them could do to help you. www.french-mortgage-advice.com or www.besteurofinance.com both of which were recommended to me via this forum & have so far been extremely helpful.
Suz
Hi Suz and thanks for your reply.
The income we have is mainly the gites + my grey panther pension. I have asked about interest only but it seems they don’t exist in France. However the main problem is my age. 70 this summer which is why the mortgage is so short and so large.
diana
Hi Diana
Do you still have income? As we found out recently ‘income is king’ in France (even if you are asset rich). But if you do have income is it not possible to remortgage over a longer term or move to interest only?
Suz