Defending the borrower against the bank

A French mortgage (crédit immobilier) commits the borrower for long periods and large sums. When circumstances change – redundancy, divorce, rising rates – the bank may accelerate the loan and demand immediate repayment of the full outstanding balance. The borrower then faces the prospect of property seizure (saisie immobilière).

That acceleration is not always lawful. The Cour de cassation strikes down automatic termination clauses that do not provide for a reasonable notice period (Cass. civ. 1re, 22 March 2023, No. 21-16.044). It also confirms that a mere acceleration clause does not relieve the lender of the obligation to send a prior formal demand (Cass. civ. 1re, 11 January 2023, No. 21-21.590). There are grounds for challenge.

What we handle

  • Challenging an irregularly pronounced acceleration of the mortgage loan
  • Analysing the conformity of the loan offer (mandatory disclosures, APRC, European Standardised Information Sheet)
  • Verifying the APRC calculation and bringing a claim for forfeiture of contractual interest where errors exist
  • Holding the lender liable for breach of the duty to warn a non-sophisticated borrower
  • Defending in property seizure proceedings following mortgage default
  • Negotiating debt restructuring plans and advising in over-indebtedness proceedings

Reflection period – Article L. 313-25, Consumer Code

The borrower has a mandatory 10-day reflection period from receipt of the mortgage loan offer. No acceptance may be given before the period expires. Any pressure exercised during this period or any premature acceptance may be sanctioned. The offer itself must remain open for a minimum of 30 days. There is no equivalent mandatory reflection period under English law for residential mortgages.

Key stages of a French mortgage

1

Loan offer

2

10-day reflection

3

Acceptance and drawdown

4

Repayment

5

Incident or dispute

Mortgage and property purchase: securing your acquisition

In France, virtually every property acquisition is conditional on obtaining mortgage finance. French law protects the buyer by imposing a condition suspensive (condition precedent) for a minimum period of one month (Article L. 313-34, Consumer Code). If the loan is not obtained within the agreed timeframe, the buyer may withdraw from the sale and recover the deposit in full.

In practice, disputes are frequent: late loan refusals, insufficient time in the condition precedent, sellers challenging the buyer’s good faith in an attempt to forfeit the deposit. Legal advice secures each step and preserves your rights.

Our services

  • Reviewing and negotiating mortgage loan terms before signing
  • Managing the finance condition precedent in purchase agreements
  • Challenging a loan refusal and dealing with the bank
  • Litigating the interdependence between the loan and the financed contract (Article L. 313-40, Consumer Code)
  • Negotiating early repayment and challenging excessive prepayment penalties (statutory cap: 6 months’ interest or 3% of the outstanding capital)

Lender sanctions – Article L. 341-25, Consumer Code

Where the lender fails to comply with its statutory obligations – mandatory disclosures in the offer, provision of the European Standardised Information Sheet (ESIS/FISE), accurate APRC calculation – it faces forfeiture of the right to contractual interest, in whole or in part. The borrower then repays only the capital, without contractual interest.

Guarantor of a French mortgage: your rights and remedies

Giving a personal guarantee (cautionnement) for a mortgage is a serious commitment. If the principal borrower defaults, the bank turns to the guarantor for the outstanding capital, interest, and penalties. The guarantor may find themselves exposed well beyond what they anticipated.

French surety law was substantially reformed by the Ordinance of 15 September 2021. Our firm verifies that the guarantee complies with the requirements of substance and form, and challenges its enforcement where it is irregular. The bank’s liability may be engaged if it failed to assess the proportionality of the guarantee properly.

What we handle

  • Analysing the validity of the surety agreement (mandatory wording, proportionality, annual information)
  • Challenging enforcement of the guarantee where the underlying loan acceleration was irregular
  • Bringing a liability claim against the bank for failure to warn a non-sophisticated guarantor
  • Defending the guarantor in property seizure or debt recovery proceedings

Frequently asked questions

My bank has accelerated my mortgage – what should I do?

Act quickly. Acceleration makes the entire outstanding balance immediately due and can lead to property seizure. Check whether the bank sent a prior formal demand with a reasonable notice period. If the procedure is irregular, the acceleration can be challenged. Contact a banking law lawyer to assess your options.

Can the interest rate (APRC) on my mortgage be challenged?

Yes. If the APRC stated in your agreement is incorrect – because certain mandatory charges were not included in the calculation – you may seek forfeiture of the lender’s right to contractual interest. The lender then loses all or part of the contractual interest. A precise legal analysis is essential to establish the error and quantify the saving.

The mortgage was not obtained – can I recover my deposit?

In principle, yes. Article L. 313-41 of the Consumer Code provides that if the finance condition precedent is not fulfilled, any sum paid in advance by the buyer must be returned. The seller may only retain the deposit if they prove that the buyer acted in bad faith to prevent the condition from being fulfilled.

Do you handle urgent cases before a property seizure?

Yes. We appear before the enforcement judge (juge de l’exécution) to challenge the validity of seizure proceedings, apply for payment deferrals, or raise defects in the enforcement title. Banking litigation and enforcement are at the core of our practice.