Buying a US home from France

Your route into the United States

A French passport lets you visit under the Visa Waiver Program, enough for viewing trips. Living there requires a status of its own, and that status decides the loan: lenders offer mainstream mortgages to people who are lawfully resident, whether on a green card or a temporary visa. Entrepreneurs can look at the E-1 and E-2 categories open to French nationals since 1960. The E-2 is tied to an operating business, and a home purchase is not one.

If you are buying a second home and staying resident in France, expect a foreign national loan with a larger down payment and a higher rate. Each route is explained in the guide to visa status and US loans.

No score to bring, and none expected

France does not run a positive credit register. The Banque de France keeps the FICP, which lists repayment incidents and over-indebtedness cases, and you have a right to ask what it holds on you. So French buyers do not lose a credit score by moving. They simply start at zero in a country that relies on one.

The practical effect is that lenders look hard at documents. Under Fannie Mae's rules, income from a foreign employer paid in foreign currency needs two years of US federal tax returns behind it, documents must be in English or translated, and assets abroad have to be converted into dollars and held in a US-regulated institution before closing.

From compromis to closing: a different rhythm

In France you sign a promise to sell, usually pay 5% to 10%, and then have a ten-day right to withdraw. If you are borrowing, the sale depends on obtaining the loan, and the period for that is usually 45 to 60 days and never less than a month. The final deed at the notary follows after that.

In the United States the offer, the loan and the transfer usually fit inside 30 to 45 days in total, and the deadline is in your contract. If the loan is not ready, the seller has to agree to wait. That is why the preparation French buyers normally do after signing has to be done before making an offer. See how the US timeline compares with Europe.

Leaving France: your home and your shares

If your French home is funding the purchase, the calendar matters. The exemption for a former main residence sold by a non-resident requires the sale by 31 December of the year following your departure, and the home must not have been let or lent in between. Letting it "for a while" can therefore be an expensive decision.

If you keep assets in France or remain resident there and buy in the US, foreign-source income is declared on form 2047. Under French tax treaties property is generally taxed in the country where it stands, with France then removing double taxation. The exit tax affects only larger shareholders: six years of residence in the last ten, and holdings of at least 800,000 euros or half of a company's profits.

Estate and gift tax

The United States requires an estate tax return from people who are neither citizens nor residents once their US assets, real estate included, exceed $60,000. France is one of four EU countries whose treaty with the United States covers both estate and gift tax, which can alter the result considerably. French forced-heirship rules add another layer, so settle the ownership structure with a specialist before buying.

Questions people moving from Europe ask

Continue your research

• Getting a US mortgage after moving from Europe
• Funding a US home with European savings or home equity
• How long a US home purchase takes, compared with Europe
• Where in the United States? Destinations for Europeans
• Start a personal US mortgage scan