Mortgages

Previously mortgages in Bulgaria for different foreigners have been quite difficult to obtain. However, various legal changes in the recent years generally in the potential way of financing some property deal make the entire process significantly easier. Although the purchase of land by foreign residents is still away, it probably will be permitted soon, too. In most cases, each particular Bulgarian mortgage lender will be able to consider the particular foreign applications, but some lenders could again restrict their financial services for the citizens of certain countries, so it will be always worth for you to check various opportunities for doing this before you commit yourself. You should always remember that if you tend to buy a flat under construction, no mortgage funds will be available for your deal until the completion of the whole building and its legal registration in your name. The legal rules will be the same for a new house or villa. On the other hand, if the land is already bought and registered in your name or under your Bulgarian company, you could use some stage payments on a drawdown basis to construct the particular building. Most of these loans available on the property market in Bulgaria today typically will also include different home improvements.

Bulgarian Mortgage Main Features

Typically the basic purpose of this loan is purchase, re-mortgage or equity release on residential property or land with planning permission in Bulgaria. The different interest rates available for mortgages here vary between 3,45 per cent and 3,7 per cent fixed margin above ECB base rate. In most cases the basic currency for all these deals is euro. Naturally, the maximum LTV, based on lower of the valuation or purchase price is about 75 per cent for loans from 100 000 euro, 70 per cent for loans from 40 000 to 99 999 euro and 60 per cent for loans only on land. The legal term of most mortgages on the Bulgarian property market is between five and twenty-five years. The minimum amount is most often 40 000 euro to 75 000 euro loan for three or four applicants, but there is no upper limit in this way of financing of property deals in Bulgaria. On the other hand, it could be generally useful for you to remember that up to 20 per cent of each rental income may be taken into account on the property to be mortgaged when assessing status. The successful applicant for mortgages in Bulgaria should be between 21 and 65 years old on the maturity of his loan. The maximum number of applicants for each mortgage is four. You should also remember that in Bulgaria married buyers own the property jointly, so the property purchase and therefore the mortgage application should as well be in joint names.

Bulgarian Mortgage Application - Required Documents

When you tend to buy some new property by mortgage in Bulgaria, you will need the following documents:
1. power of attorney
2. marital status certificate
3. a specific certificate regarding any business in Bulgaria
4. some credit history report, such as Experian Scorex or Equifax for all United Kingdom citizens.

If you are an employed applicant or co-applicant for some mortgage in this European country, you should present:
1. an official P-60 form
2. a special letter from your employer stating your gross income is also recommended
3. general bank statements for the last three months.

All self-employed applicants or co-applicants should present:
1. a financial certificate for the previous year or the income tax return
2. bank statements for the last three months.

Finally, if you are applicant receiving some rental income, you will need:
1 bank statements for the last three months
2. lease contract in case that the rental income is not shown in the specific tax return.