Life mortgage
Verified 26 August 2025 - Directorate of Legal and Administrative Information (Prime Minister)
You own a home that you have paid for and you want to use it to get credit? Maybe you can make a life mortgage. This loan is guaranteed by a mortgage on a dwelling for residential use. Currently, the life mortgage loan is marketed only by a few specialized institutions.
It exists 3 types Life Mortgage Loan (LVL):
- The life mortgage ‘classic’ : no repayment during the life of the borrower. The principal and interest are repaid on death or on the sale of the property.
- The life mortgage with periodic repayment of interest : the borrower repays only the interest on the loan each month. The principal is repaid at the end of the contract.
- The Advance loan transfer (Pam), also called energy retrofit mortgage : this loan is intended to finance energy-saving works. It benefits from regulated conditions (cap on fees, limited interest rate, minimum amount of borrowing).
Type of loan | Repayment condition | Primary Use | Peculiarity |
|---|---|---|---|
“Classic” life mortgage with interest repayable on the death of the borrower | No repayment during the life of the borrower. Capital + interest repaid on death or sale of the property. | Financing of personal projects | No periodic repayment, interest capitalized to term |
Life mortgage with periodic interest repayments | Interest paid periodically (monthly or quarterly). Capital repaid at the end. | Financing of personal projects | Allows to relieve the debt during life, but requires regular payment of interest |
Transfer Advance Loan (Pam) | No interest to pay for 10 years (zero rate). Capital + interest (post-10 years) repaid on death | Financing of energy renovation works | Advantageous conditions (fee cap, limited rate) |
Classic
Financing a project
A life mortgage is a credit secured by a home you own.
It allows you to receive a sum of money without having to repay the loan during your lifetime. The reimbursement (principal + interest) is usually made at the time of your death, or if you sell your home.
This loan is often used by the elderly to finance personal needs (stay in a retirement home, work, home help, travel,...), but not to finance a professional activity.
Difference with life annuity and conventional mortgage
Life mortgage should not be confused with life-annuity sales and the classic mortgage.
- In the event of a life sale, ownership of the home is transferred to the buyer, while the life mortgage allows you to remain the owner.
- Conventional mortgages require you to repay part of the principal and interest periodically, while life mortgages allow you not to repay any principal or interest during your lifetime.
Persons concerned
To apply for a life mortgage, you must be of age and own the home you want to provide as collateral.
There is no obligation to take out home insurance and/or to insure the loan.
None medical questionnaire, no proof of income is required.
Immovable property concerned
The dwelling that serves as security must be a property for exclusive residential use. This means that it should only be used as a dwelling and not as a business premises.
This property can be a primary or secondary residence or a rented property.
Warning
A mixed-use property (residential and professional) cannot be used as collateral for a life mortgage.
You can apply for a loan from a credit agency that offers this product.
The lending organization (called lender or creditor) will then set the amount of the loan according to the following 3 criteria:
- Value of the property, determined by an expert, chosen by you and the lending organization (the expertise costs are at your expense)
- Your age (if you are young, the amount of the loan will be less important, because there will be statistically a long period of calculation of interest)
- Your gender (as women have a longer life expectancy than men, they also have a longer likely interest calculation time than men).
The creditor may refuse the loan if, for example, he considers that the property may lose its value.
If the application is accepted, the total amount of the loan does not correspond to the value of the collateral, but only to a part. In general, the loan granted varies between 15% and 75% of the value of the property.
Warning
The life mortgage loan is offered only by specialized institutions.
The lender has an obligation to set an interest rate that includes all the costs of the loan (application fees, interest, borrower insurance). This rate is called the annual rate of charge. It is used to calculate the amount you must repay if you want to make an early refund. This rate will also be used to calculate the amount owed by your heirs if they want to repay the bank and keep the property.
The lender is free to set its rate. They are quite high in general.
However, the annual percentage rate of charge may not be higher than rate of wear over a period of 10 years. There are 3 rates of wear and tear depending on the amount of the loan:
Credits | Rate of wear |
|---|---|
Loans up to and including €3,000 | 21.45% |
Loans in excess of €3,000 and not more than €6,000 | 11.47% |
Loans in excess of €6,000 | 6.64% |
Interest accrues throughout the term of the loan, but will only be repaid upon death or sale of the property.
FYI
It is recommended that the total amount due for a life mortgage be compared with that of a conventional consumer credit for the same borrowed capital.
Mandatory information
Before signing, the bank or lender must provide you with a complete and clear loan offer, including the following:
- Identity of the parties and date of acceptance: the names and contact details of the borrower and lender, and the date from which you can accept the offer
- Precise description of the mortgaged property: the exact description of the dwelling given as security, in accordance with the legal requirements for its official registration
- Value of the property and valuation costs: the estimated value of the property, determined by an expert chosen by you and the lender, as well as the valuation costs if you have to bear them. For some loans, this estimate can be made directly by the lending institution
- Nature of the loan: the type of mortgage life loan offered (traditional, with periodic interest repayment, or advance transfer)
- Conditions for making funds available: the date and conditions for the payment of funds, either in one installment or in installments (e.g. monthly annuity)
- Detailed schedule: If the funds are paid in installments, a schedule specifies the dates and amounts of the payments, distinguishing the share of capital and the interest accumulated during the expected term of the loan, so that you can track the gradual use of the net worth of your home. If the capital is paid in 1 single installment, a statement of accumulated interest is provided for the same understanding.
- Total cost of credit and annual percentage rate of charge (APR): quantified examples of the total cost of the loan over several hypothetical terms, with the APR including all charges, interest and insurance, to allow you to compare this offer with other loans
- Duration of validity of the offer: the period during which this proposal remains valid, to give you time to think before committing
- Information specific to loans with periodic interest repayment: for a fixed rate, a schedule of monthly interest payments is provided. For a variable rate, a simulation of the impact of a change in rates on your monthly payments is provided, without commitment from the lender on the actual evolution of rates.
- Obligations and rights related to the loan: the offer also specifies the conditions under which you can repay the loan early, the possible consequences in case of non-payment of the installments, and the conditions for transfer or repayment of the loan in case of death of the borrower. It also provides information on the rights of the heirs regarding the repayment of the loan and the conservation of the property.
You have a right of reflection, that is to say that a minimum period of 10 calendar days between the receipt of this offer and the signing of the contract.
FYI
Until the credit offer is accepted, the lender cannot make any payment to you.
Signature of the contract
The contract is signed before a notary.
The costs are at your expense.
Who shall I contact
The notary must check that the property has been correctly estimated.
Maintenance of the property
You must maintain the mortgaged property (facade renovation, various works, garden maintenance...). In case of poor maintenance, the lender can claim early repayment of the loan.
An inventory may be appended to the notarial deed at the time of signing the contract. It will be a proof of the condition of the property and its equipment.
In the event of a dispute, it is up to the lender to prove that the property has been poorly maintained.
Rental of the property
If you wish to rent the mortgaged property, you must first obtain the written consent of the lending organization. The mortgaged property may not under any circumstances be used for a professional activity.
The loan agreement can be terminated in several ways: early repayment, sale of the property, death of the borrower.
Répondez aux questions successives et les réponses s’afficheront automatiquement
Early repayment
You can repay the loan in full or in part before the end date stipulated in the contract.
However, the lender may refuse partial early repayment if it is less than 10% of the capital lent.
The contract may provide for compensation to be paid to the lender in the event of early repayment of the loan.
This allowance varies according to the date of reimbursement:
Before the 5th year
The amount of compensation varies depending on the method of making the loan available:
Paid-in capital at once
4 months of interest
Capital paid in periodically
5 monthly payments
Grades 5 to 9
The amount of compensation varies depending on the method of making the loan available:
Paid-in capital at once
2 months interest
Capital paid in periodically
3 monthly payments
From the 10th year
The amount of compensation varies depending on the method of making the loan available:
Paid-in capital at once
1 month interest
Capital paid in periodically
2 monthly payments
Sale of the mortgage property
You must notify the lender if you decide to sell your property or give up the usufruct or the bare-property.
If the lender disputes the sale price or the estimate indicated in the draft sale, it may request an expert appraisal. If the appraisal concludes that the value of the property is higher than the envisaged price, the lender may:
- oppose the sale, or
- either claim reimbursement on the basis of that estimated value (and not on the declared selling price),
- or initiate a seizure procedure to sell the property at the estimated price.
In case of sale by the lender, any excess price obtained after loan repayment returns to the estate.
Death of the borrower
Your death terminates the loan agreement.
The situation varies depending on whether your heirs want to sell the property or keep it:
The heirs don't want to keep the property
Your heirs let the bank sell the property to pay off.
If the amount of the sale exceeds the principal paid to you and the total interest calculated, your heirs will be able to collect the difference.
Otherwise, if the value of the property is less than the amount of principal and interest due, your heirs don't have to pay the difference. Their liability is limited the value of the mortgaged property. This means thatno other personal or estate property may be seized to pay the debt.
The heirs want to keep the property
Your heirs must pay the bank your debt, principal and interest calculated according to the rate set in the contract.
After payment, your heirs will be the owners of the property and they will be able to dispose of it freely.
Periodic refunds
Financing a project
This loan allows you to receive a sum of money by putting your home in mortgage, while remaining owner
Unlike the traditional formula, you only have to repay the interest regularly (for example, every month). The capital borrowed will be repaid at the end of the contract, either at the time of sale of the property or at your death.
This type of loan can finance a personal project (stay in a retirement home, home help, travel,...), but not a professional activity.
Difference with life annuity and conventional mortgage
A life mortgage with periodic interest payments should not be confused with a life sale or a conventional mortgage.
- In the event of a life sale, you sell your home and lose ownership of it. With a life mortgage, you remain the full owner of your property.
- In the case of a conventional mortgage, you must repay both the principal and the interest each month. With this life mortgage, you only pay back interest for the duration of the loan. The capital is repaid at the end, by the sale of the property or by your heirs.
Persons concerned
To apply for a life mortgage, you must be of age and the owner of the home you wish to provide as collateral.
There is no obligation to take out home insurance and/or to insure the loan.
None medical questionnaire no proof of income is required.
Immovable property concerned
The dwelling that serves as security must be a property for exclusive residential use. This means that it should only be used as a dwelling and not as a business premises.
This property can be a primary or secondary residence or a rented property.
Warning
A mixed-use property (residential and professional) cannot be used as collateral for a life mortgage.
You can apply for a loan from a credit agency that offers this product.
The lending organization (called lender or creditor) will then set the amount of the loan according to the following 3 criteria:
- Value of the property, determined by an expert, chosen by you and the lending organization (the expertise costs are at your expense)
- Your age (if you are young, the amount of the loan will be less important, because there will be statistically a long period of calculation of interest)
- Your gender (as women have a longer life expectancy than men, they also have a longer likely interest calculation time than men).
The creditor may refuse the loan if, for example, he considers that the property may lose its value.
If the application is accepted, the total amount of the loan does not correspond to the value of the collateral, but only to a part. In general, the loan granted varies between 15% and 75% of the value of the property.
Warning
The life mortgage loan is offered only by specialized institutions.
The lender has an obligation to set an interest rate that includes all the costs of the loan (application fees, interest, borrower insurance). This rate is called the annual rate of charge. It is used to calculate the amount you must repay if you want to make an early refund. This rate will also be used to calculate the amount owed by your heirs if they want to repay the bank and keep the property.
The lender is free to set its rate, and they are quite high in general.
However, the annual percentage rate of charge may not be higher than rate of wear over a period of 10 years. There are 3 rates of wear and tear depending on the amount of the loan:
Credits | Rate of wear |
|---|---|
Loans up to and including €3,000 | 21.45% |
Loans in excess of €3,000 and not more than €6,000 | 11.47% |
Loans in excess of €6,000 | 6.64% |
The amount of the periodic interest payments must be specified at the outset. You must repay these maturities during the term of the loan.
FYI
It is recommended that the total amount due for a life mortgage be compared with that of a conventional consumer credit for the same borrowed capital.
Mandatory information
Before signing, the bank or lender must provide you with a complete and clear loan offer, including the following:
- Identity of the parties and date of acceptance: the names and contact details of the borrower and lender, and the date from which you can accept the offer
- Precise description of the mortgaged property: the exact description of the dwelling given as security, in accordance with the legal requirements for its official registration
- Value of the property and valuation costs: the estimated value of the property, determined by an expert chosen by you and the lender, as well as the valuation costs if you have to bear them. For some loans, this estimate can be made directly by the lending institution
- Nature of the loan: the type of mortgage life loan offered (traditional, with periodic interest repayment, or advance transfer)
- Conditions for making funds available: the date and conditions for the payment of funds, either in one installment or in installments (e.g. monthly annuity)
- Detailed schedule: If the funds are paid in installments, a schedule specifies the dates and amounts of the payments, distinguishing the share of capital and the interest accumulated during the expected term of the loan, so that you can track the gradual use of the net worth of your home. If the capital is paid in 1 single installment, a statement of accumulated interest is provided for the same understanding.
- Total cost of credit and annual percentage rate of charge (APR): quantified examples of the total cost of the loan over several hypothetical terms, with the APR including all charges, interest and insurance, to allow you to compare this offer with other loans
- Duration of validity of the offer: the period during which this proposal remains valid, to give you time to think before committing
- Information specific to loans with periodic interest repayment: for a fixed rate, a schedule of monthly interest payments is provided. For a variable rate, a simulation of the impact of a change in rates on your monthly payments is provided, without commitment from the lender on the actual evolution of rates.
- Obligations and rights related to the loan: the offer also specifies the conditions under which you can repay the loan early, the possible consequences in case of non-payment of the installments, and the conditions for transfer or repayment of the loan in case of death of the borrower. It also provides information on the rights of the heirs regarding the repayment of the loan and the conservation of the property.
The loan offer must include numerical examples indicating the likely evolution of the debt (capital + interest) according to different duration assumptions. These simulations allow you to anticipate when the amount of debt could reach the net value of the home.
You have a right of reflection, that is to say that a minimum period of 10 calendar days between the receipt of this offer and the signing of the contract.
FYI
Until the credit offer is accepted, the lender cannot make any payment to you.
Signature of the contract
The signature is done in front of a notary.
The costs are at your expense.
Who shall I contact
The notary must check that the property has been correctly estimated.
Maintenance of the property
You must maintain the mortgaged property (facade renovation, various works, garden maintenance...). In case of poor maintenance, the lender can claim early repayment of the loan.
An inventory may be appended to the notarial deed at the time of signing the contract. It will be a proof of the condition of the property and its equipment.
In the event of a dispute, it is up to the lender to prove that the property has been poorly maintained.
Periodic repayment of interest
You must pay the periodic monthly interest payments provided for in the contract.
Failure to repay one or more periodic interest installments shall be punished by the payment of compensation of up to 4 months' interest.
In addition, the lending institution may require the repayment of all the capital lent.
Rental of the property
If you wish to rent the mortgaged property, you must first obtain the written consent of the lending organization. The mortgaged property may not under any circumstances be used for a professional activity.
The loan agreement can be terminated in several ways: early repayment, sale of the property, death of the borrower.
Répondez aux questions successives et les réponses s’afficheront automatiquement
Early repayment
You can repay the loan in full or in part before the end date stipulated in the contract.
However, the lender may refuse partial early repayment if it is less than 10% of the capital lent.
The contract may provide for compensation to be paid to the lender in the event of early repayment of the loan.
This allowance varies depending on the date of reimbursement.
Before the 5th year
The amount of compensation varies depending on the method of making the loan available:
Paid-in capital at once
4 months of interest
Capital paid in periodically
5 monthly payments
Grades 5 to 9
The amount of compensation varies depending on the method of making the loan available:
Paid-in capital at once
2 months interest
Capital paid in periodically
3 monthly payments
From the 10th year
The amount of compensation varies depending on the method of making the loan available:
Paid-in capital at once
1 month interest
Capital paid in periodically
2 monthly payments
Sale of the mortgage property
You must notify the lender if you decide to sell your property or give up the usufruct or the bare-property.
If the lender disputes the sale price or the estimate indicated in the draft sale, it may request an expert appraisal.
If the appraisal reveals that the value of the property is higher than the expected selling price, the lender may:
- refuse sale
- seize the property
- or obtain a refund equivalent to the appraised value, and not at the undervalued selling price.
If the property is sold by the lender (for example in case of non-repayment or after death), any amount remaining after repayment of the loan shall be returned to the estate, i.e. the heirs of the borrower.
Death of the borrower
Your death terminates the loan agreement.
The situation varies depending on whether your heirs want to sell the property or keep it:
The heirs don't want to keep the property
Your heirs let the bank sell the property to pay off.
If the amount of the sale exceeds the principal paid to you and the total interest calculated, your heirs will be able to collect the difference.
Otherwise, if the value of the property is less than the amount of principal and interest due, your heirs cannot be required to settle the difference. Their liability is limited the value of the mortgaged property. This means thatno other personal or estate property may be seized to pay the debt.
The heirs want to keep the property
Your heirs must pay the bank your debt, principal and interest calculated according to the rate set in the contract.
After payment, your heirs will be the owners of the property and they will be able to dispose of it freely.
Pam
You want to insulate your home to reduce your energy bills. the Advance loan transfer (Pam) can allow you to finance this work, without having to repay the capital before the sale of your home or your death.
Who can help me?
Find who can answer your questions in your region
0809 540 550 DGCCRF - ConsoResponse
Are you experiencing a problem following a purchase? Do you have a question on a point of law before buying or ordering?
You can get an answer from an agent of the DGCCRF: titleContent by calling the 0809,540,550.
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Definition and scope of application of a life mortgage loan
Mortgage Life Loan Credit Agreement
Assignment and maintenance of the building
Prepayment of the mortgage life loan
Term of the life mortgage transaction
Life mortgage