Making a decision for buying your own property is always a big step in life. It is even harder to make that decision if you are living abroad and you are not feeling at ease dealing with the whole procedure. However, it is worse if you are living abroad, you want to buy your own property but you don’t have enough money to pay for it at once. Then you definitely need to apply for a mortgage loan which seems like a “mission impossible” in terms of not being a local.
But don’t worry! Foreigners.cz cares enough for expats living in the Czech Republic and strives to make your living in the country more comfortable. That is why we have launched free consultations with a financial consultant who will advise foreigners on mortgage possibilities in the Czech Republic.
Jakub Vojtech is a trustworthy personal advisor on mortgage loans who will be giving free consultations on this issue at Foreigners.cz. To start with, Jakub sat down with us to discuss the basic and the most important questions about mortgage loans. 1. How can foreigners apply for a mortgage loan?
Foreigners can go to any Czech bank and ask about the possibility of getting a mortgage loan. In this case, the problem is that each bank assesses foreigners very differently in terms of options, requirements and conditions of mortgage loans. However, they will always try to sell you their offers despite the fact that they may not be the best ones for you.
The best way of applying for a mortgage loan is to meet with a professional financial consultant, who will listen to your requirements and financial possibilities. Based on the information you provide, he will make proper recommendations to you and he will find the best solution across all Czech banks. Another advantage of using the services of a professional consultant is that he will help you in going through the whole process of getting mortgage loan and purchasing, safely and smoothly. The consultant will also help you in negotiating the best terms with the bank and will recommend you what to be aware of.
2. What kinds of mortgages are available on the market?
Mortgage has two basic parameters – the loan has to be secured by real estate and the purpose of the loan must be solution of housing needs.
Perhaps the most important parameter is the ratio of mortgage loan against the value of the property (LTV – Loan to Value). Ordinarily, banks lend 85% LTV, where the value is the price valued by an expert from the bank, based on price maps and the ability to sell the property in case the client defaults. Therefore, the bank can sometimes value the property lower than the real market price is and lower than the price at which you want to buy property. Then people may need to use more of their own resources. Our specialists recommend having prepared ideally 20% to 30% of your own funds on real estate price.
3. What kinds of documents are needed?
There are 3 main areas that the bank checks (each bank has its own forms, though):
– Your personal information, marital status, citizenship, and so on.
– Your income, especially amount, source and stability.
– The property, its value set by the bank expert and possible legal or technical risks.
4. How much time does the whole procedure take?
The whole process above all depends on the people involved, so the length of the process can’t be generalized. From the first meeting with your mortgage expert it may take one to two months pending the signing of a purchase and loan contracts.
6. Which is the wiser solution for foreigners – to apply for mortgage loan by themselves or to trust a mortgage broker and let them do the work?
A mortgage is an issue that people solve several times in a lifetime and usually it is a very crucial step in life. Answer for yourselves, whether it is better for you to trust a bank employee, who is motivated to sell you a product, make money to its bank and who will never go with you into the field of helping you, or maybe it is better to use the services of an expert who will be watching your back, helping you in going through the process safely and without stress.
Liduška Nerudová, Executive Assistant: “Jakub helped me buy an apartment and arrange a mortgage last year. First of all, he evaluated my overall financial situation to find out whether it is a good decision, with respect to my cashflow, future plans, etc. Then he supervised the whole process, paperwork, took care of communication with a lawyer, landlord and the bank, negotiated with the bank even better conditions than those originally proposed and didn’t let me sign anything until he was 100% sure it was correct and fair.”
If you are interested in arranging a meeting with Jakub Vojtech in Brno or in Prague, please feel free to do it by sending an e-mail to firstname.lastname@example.org or email@example.com
Author: Nadya Dyakova, PR intern of Foreigners.cz Brno