Visit Ukraine - Which EU countries have the cheapest mortgages or where it is profitable to buy a home on credit?

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18 Sep. 2024

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Which EU countries have the cheapest mortgages or where it is profitable to buy a home on credit?

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Which European Union countries have the lowest mortgage interest rates?
Where are the highest mortgage rates in the EU?
What mortgage rates do other EU countries have?

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Which EU countries have the cheapest mortgages or where it is profitable to buy a home on credit?

For many people, mortgages and long-term loans are the only way to get their own home. It is important to keep in mind that the interest on such a loan is stable over time. Find out which European countries have the cheapest and most expensive mortgages

Legal advice on the purchase and registration of real estate in Ukraine and abroad

Legal advice on the purchase and registration of real estate in Ukraine and abroad

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Many people, mostly young people, consider a mortgage to be the only way to get their own home. A mortgage is actually a long-term loan that can be repaid over years or even decades. At the moment, many Ukrainians are forced to move to the European Union, and some of them decide to stay there forever. Read the article to find out which countries have the lowest and highest mortgage prices.

Which European Union countries have the lowest mortgage interest rates?

According to a study by Bankier.pl, the countries with the lowest mortgage interest rates are Malta (2.19%) and Bulgaria (2.53%).

Getting a mortgage in Malta

Real estate in Malta is not cheap compared to other European countries, but it is quite easy to get a mortgage here. Since the country is one of the most densely populated, foreigners have certain restrictions on buying property - one family can buy only one apartment. At the same time, it is not recommended to buy a property in Malta to rent it out: the apartment is either located in a luxury complex where rent prices are sky-high, or you need to obtain a special permit from the authorities to rent it.

Foreigners have the right to take out a mortgage with a local bank, but the authorities scrutinise documents carefully, so it is worth contacting specialists to prepare the package to avoid wasting time and effort and being rejected. The growth in property values here is 10% per year, and the mortgage is a maximum of 4.5%. So the benefits are obvious.

What are the conditions for getting a mortgage in Malta?

- You must be at least 21 and not more than 65 years old;

- 30% of the funds are paid initially, and 70% of the loan is issued;

- the minimum mortgage term is 9 years and the maximum is 30 years;

- there is a possibility of interest-free early repayment;

- the only currency for mortgages is the euro;

- home and life insurance is required for the borrower.

What package of documents do I need to collect to get a mortgage in Malta?

1) Purchase agreement;

2) Real estate insurance contract;

3) Borrower's life insurance contract for the entire loan term;

4) The borrower's income statement (the income must be three times the monthly deductions for the planned loan);

5) Written consent of the other spouse to the mortgage;

6) Bank statement for the last year with a description of all transactions.

7) A copy of the passport.

8) A copy of the foreign passport.

9) 2 photographs

Please note: In order to obtain a mortgage in Malta, you need to confirm that you have no criminal record, no debt obligations and no other types of bad reputation in your home country.

You can findcomprehensive information on the rules of entry to Malta for Ukrainians on the Visit Ukraine portal.

How to get a mortgage in Bulgaria?

Mortgages for Ukrainians in Bulgaria are issued by 7 banks, including UniCredit, Alfa-Bank, DSK-bank, Postbank, Bulgarian-American Credit Bank and others.

The easiest way for foreigners to buy a home is from a developer who cooperates with one or more banks. The advantage is the loyal attitude of the lender.

Stages of obtaining a mortgage to buy a secondary market apartment in Bulgaria

1) Choose an object and book it: the search for an object is carried out independently or through a realtor, and there is no licensing system for the latter - trust only trusted specialists; the reservation involves a transfer of about 2-3 thousand euros.

2) Choose a bank and collect documents.

3) Apply for a mortgage loan - you can do this in person or delegate an authorised representative by power of attorney.

4) Approval of the application - the procedure takes about 1.5-2 months, during which time all the necessary related procedures are carried out: real estate appraisal, signing of an insurance contract, notarisation.

5) Conclusion of the transaction and re-registration of the property.

Package of documents for obtaining a mortgage in Bulgaria

- a copy of the passport

- a copy of the foreign passport;

- certificate of marriage or divorce;

- income statement for the last tax period;

- certificate of payment of taxes for the last tax period;

- salary certificate from the main place of work;

- bank statement on the movement of funds in the account for the last six months;

- an extract from the Unified State Register of Real Estate with information about the real estate owned and the absence of encumbrances on it;

- certificate from the credit history bureau + letter of recommendation from the Ukrainian bank of which the person is a client (IF REQUIRED)

- a preliminary real estate purchase and sale agreement.

Property prices in the European Union vary widely. Earlier, we told you where and at what prices Ukrainians buy housing in Europe. For more details, please follow the link.

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Where are the highest mortgage rates in the EU?

According to the Credit Information Bureau, Poland has the highest mortgage rates in the European Union. As of September 2024, about 4 million residents of the Republic of Poland have an active mortgage loan.

First of all, it is worth noting that most mortgages in Poland require a down payment, meaning that a person must work for several years to accumulate a down payment before obtaining a mortgage. In general, the down payment in Poland is 30% of the property value. That is, if a typical apartment costs 300 thousand zlotys, a person has to save 60 thousand, which is very difficult.

Earlier, we told you that Ukrainians are buying housing in Poland. To learn more about this and what types of housing are most often chosen, follow the link.

Poland has the highest mortgage interest rates among all EU countries (7.90%), so you will need to pay it back for decades after receiving it, and pay the bank an amount several times higher than the principal.

What mortgage rates do other EU countries have?

According to a study by Bankier.pl, other EU countries have the following mortgage rates: Spain - 3.34%, France - 3.41%, Belgium - 3.41%, Slovenia - 3.61%, Portugal - 3.70%, Croatia - 3.57%, Greece - 3.87%, Germany - 3.92%, Austria - 3.94%, Luxembourg - 3.95%, Ireland - 4, 08%, Finland - 4.10%, Slovakia - 4.19%, Cyprus - 4.33%, Sweden - 4.44%, Denmark - 4.75%, Czech Republic - 4.88%, Lithuania - 5.36%, Estonia - 5.53%, Latvia - 5.68%, Hungary - 7.24%, Romania - 7.38%.

Earlier, Visit Ukraine experts gave practical advice on how Ukrainians can buy a home abroad. Read the details here.

To check the owner of the property, the realtor, draw up a purchase and sale agreement and prepare the necessary package of documents (we remind you that they differ slightly in different EU countries), please contact Visit Ukraine's real estate specialists. You will be able to quickly get qualified legal assistance and be sure that the mortgage will be successful.

Photo: Judicial and Legal Newspaper

Want to know more? Read the latest news and useful materials about Ukraine and the world in the News section.

Ihor Usyk is the Head of Legal Department at Visit Ukraine

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Frequantly

asked questions

Which European countries have the cheapest mortgages?

According to a study by Bankier.pl, the countries with the lowest mortgage interest rates are Malta (2.19%) and Bulgaria (2.53%).

What are the restrictions on buying a home in Malta?

Can a foreigner rent out a property in Malta?

What is the growth in housing prices in Malta?

What is the age threshold for obtaining a mortgage in Malta?

Where are the highest mortgage rates in the EU?

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FAQ

- - What COVID documents do I need to have with me when entering Ukraine now?
    On July 1, 2023, the Ukrainian authorities lifted the quarantine and other restrictions imposed due to the COVID-19 pandemic. From now on, you do not need to provide proof of vaccination, a negative PCR test result or wear a protective mask to enter Ukraine.
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    Recently, the number of foreign travelers has increased in Ukraine. They visit the country for various purposes: volunteering, participating in humanitarian programs, filming reports or documentaries, setting up a business, etc. There are currently no cities in Ukraine that are completely safe. And although the main fighting is concentrated in the eastern and southern parts of Ukraine, the entire country is subject to regular rocket attacks.
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  All foreign citizens are required to have an insurance policy covering the costs of Covid-19 treatment in Ukraine.
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  According to the Resolution of the Cabinet of Ministers of Ukraine No. 1236, an insurance policy must be issued for the entire period of stay in Ukraine. The minimum period is not specified.
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  This policy guarantees monetary compensation in the event of an accident as a result of military operations, passive military risks, terrorist acts, including emergency care, outpatient treatment, hospitalization and repatriation of the insured person (or his/her body in case of death) from the place of stay to the place of his/her permanent residence.
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  The insurance policy is valid on the territory of Ukraine, except for the temporarily occupied territories of Luhansk, Donetsk, Kherson and Zaporizhzhia regions and the Autonomous Republic of Crimea, as well as the territories of direct combat operations (front line).
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