The mortgage lending rate in Russia is now about 15%. The expediency of buying real estate at such a rate can be questioned, the overpayment is too high. But European and foreign banks offer more loyal conditions that Russians can only dream of.
Europe is the most popular among Russians in terms of real estate acquisition. According to various estimates, every second Russian citizen acquires an apartment abroad using a mortgage.
Mortgage lending conditions in Europe
European banks issue mortgage loans with rates ranging from 2-3 to 7%. This is 5 times lower than in Russia. Loans can be obtained only for real estate located in the region of the bank's operation. This means that it is impossible to direct borrowed funds to purchase a Russian apartment. This is because for the duration of the mortgage, the apartment will be pledged by the bank, and, accordingly, it will assess it for liquidity. The bank must be sure that it can easily sell the apartment for which the loan is being provided.
It should be borne in mind that in some European countries with a difficult economic situation, mortgage loans are issued on less favorable terms. For example, in Bulgaria, Turkey, Spain, the mortgage rate can reach 9%.
Usually loans are issued exclusively for residential real estate. It will be extremely problematic for a foreigner to obtain a loan for the purchase of commercial real estate.
A mortgage loan can be provided for up to 30 years, but the bank will assess the age of the borrower. As a standard, borrowed funds can be obtained for 80% of the value of the property. But now banks, in order to attract borrowers, approve loans for 110% of the developer's price. This 10% will later be used to pay additional fees associated with registration. There are also countries with more stringent conditions. For example, in Italy, you will need to deposit up to 60-80% of your own funds.
There are limits on the amount of the mortgage. So, in Germany, "inexpensive" mortgages up to 60 thousand euros are not welcomed, in Italy - up to 100 thousand euros, in Great Britain - up to 500 thousand euros, and in Turkey loans are issued for 10 thousand euros.
When a mortgage is overdue, banks usually do not go to court, but insist on the urgent sale of the object.
In which countries can I take a mortgage
All countries can be divided into groups in terms of the availability of mortgage loans. It:
- Mortgage loans are not available or borrowers are subject to such stringent requirements that it is almost impossible to get loans. Today the list of such countries includes Italy, Cyprus, Croatia, Austria, Montenegro, Switzerland, England, Romania.
- It is quite possible to get a mortgage, but its registration implies territorial or procedural restrictions. For example, Germany, Czech Republic and France.
- Mortgages are fairly affordable, but lending terms are less favorable. Among such countries, for example, Portugal, Spain, Finland.
Stages of registration of mortgage loans abroad
Experts recommend initially choosing a property. It often happens that an apartment is already owned by a bank, then it will be possible to issue a mortgage only in it. Moreover, the bank can offer more favorable conditions for "its objects". If the real estate is non-bank, you can contact any bank.
Next, you need to contact the bank (personally or through intermediaries) and get acquainted with its requirements for the borrower and the list of requested documents.
The main thing in deciding on the provision of a mortgage is the borrower's ability to fulfill their obligations under the loan. The solvency requirements of borrowers vary from bank to bank and country to country. For example, in Spain, you need to have a monthly income three times more than your loan payments.
In many respects, the interest rate that is provided to him depends on the results of the assessment of the borrower. Therefore, the more documents the borrower provides, the more favorable conditions he will be offered. These can be documents confirming income; an extract from the bank's personal account; reference-characteristics of the borrower from a Russian bank or BKI; certificates of real estate, car. Please note that the documents will need to be translated from Russian. The costs for this can be up to 150-200 euros.
Most banks will require a certificate from the bank about the availability of funds for the initial payment. In a number of countries, they can additionally request a student or work visa, a guarantee from a resident of the country, a certificate of absence of loan arrears, permission from the authorities to purchase real estate.
By the way, the borrower does not always need to contact the bank; it is often possible to get an installment plan directly from the developer. For example, such offers can be used in Bulgaria, Turkey, Montenegro. The installment plan assumes the payment of the loan amount in a period of up to a year without interest.
And in Greece, which is experiencing a grave crisis, banks have completely suspended mortgage lending and installments are the only option to purchase housing with a shortage of their own funds. Such loans are not provided in the UK either.
