French mortgage approvals have become more rule-bound in recent years — largely due to stricter regulation by the Haut Conseil de Stabilité Financière (HCSF), France’s financial stability authority. For non-residents earning abroad, understanding how the 35% debt-to-income (DTI) rule, term limits, and income assessment work is essential.

This article explains the practical implications of HCSF rules, especially how rental income and property outgoings are treated in your mortgage eligibility.

1. The 35% Debt-to-Income (DTI) Rule: A Fixed Ceiling

Since January 2022, the HCSF requires French banks to adhere to a maximum 35% DTI ratio — that is, your total monthly debt repayments cannot exceed 35% of your net monthly income.

Applies to:

• French residents and non-residents alike
• Mortgages for primary, secondary, or investment homes
• All applicants, regardless of nationality or employment source

What’s included in “debt”?

• Mortgage repayments (existing and new)
• Personal loans and car finance
• Existing rental property repayments
• Alimony or maintenance obligations

2. Loan Term Limits: Capped at 25 Years

The maximum mortgage term is 25 years, or 27 years if the mortgage includes up to 2 years of construction or renovation works. This aligns with the HCSF’s broader goal to reduce excessive lending terms that can mask unaffordable monthly repayments.

Note: Some banks may self-limit terms further to 20–22 years for non-residents, especially where FX risk is higher.

3. How Rental Income is Treated

Net Rental Income is Partially Included

French banks apply a “haircut” or discount to rental income. Typically:

• 70% to 80% of gross rental income is considered
• Remaining 20–30% accounts for vacancies, maintenance, tax, or management fees

This applies to both:

• Existing rental properties you own abroad or in France
• Projected rental income on the property being purchased (especially in LMNP furnished rental schemes)

Example: You earn $4,000 in rental income monthly. Only $3,000 (75%) might be counted toward your DTI eligibility.

4. How Buy-to-Let Outgoings Are Treated

Your existing rental mortgage payments are fully included in the DTI calculation — even if the corresponding rental income is discounted. This conservative approach can impact investors with:

• Highly leveraged international portfolios
• Rental properties with high ongoing expenses (management, maintenance, or insurance)

5. What About Exceptions? The “Flexibility Margin”

Banks may deviate from the strict 35% rule up to 20% of cases — but under tightly defined conditions:

• Primary residence purchases
• High-income borrowers with significant assets (patrimoine)
• Well-secured investment purchases (e.g., low LTV, high net worth)

This “flexibility margin” is not automatic and varies by bank. For non-residents, it is rarely granted without substantial assets or a private banking relationship.

6. Strategic Takeaways for International Buyers

• Run your own DTI calculation: Factor in all global debts, not just local.
• Optimise declared rental income: Use tax filings and net yield documents.
• Present a full financial profile: Include liquid assets and wealth statements.
• Leverage dual income: Couples applying together may increase income scope — if documentation is robust.
• Use a broker: French brokers fluent in cross-border cases can direct your application to lenders most open to non-residents.

Conclusion: HCSF Compliance Doesn’t Mean “No” — It Means “Prepare”

The HCSF’s intent is financial prudence — not exclusion. While French banks are stricter, they remain open to well-structured international applicants. Understanding how your debt, income, and assets are assessed under this framework empowers you to build a case that aligns with these national stability rules — and still gets approved.