Mortgage & Credit

Mortgage

Cyprus banks offer quite loyal terms for obtaining a mortgage to property purchasers.

The collateral to obtain mortgage for property acquisition in Cyprus is the very property to be purchased. To obtain mortgage you are definitely required to submit evidence of your ability to repay it to the banks.

Basic parameters of a mortgage

You will have to determine basic parameters of the credit that are provided in the table below:

 

Credit parameter Comments
Amount of credit The maximum amount of credit is 50-60% (exact figure depends on the bank's policy and macroeconomic conditions) of contract value of the property. Accordingly a borrower shall pay at least 40-50% of property value out of his/her own funds.
Term for credit issuance

The maximum term for credit issuance is calculated according to the formula “65 or 70 years minus borrower’s age”.

The minimum term usually equals to 10 years.

Advanced credit repayment is possible but it is associated with payment of a penalty

Credit currency Besides EUR, credits may be issued in USD or CHF
Credit rate


A borrower may choose one of several rate calculation schemes. The rate may be referred to an interbank rate of Euribor (Libor) or to an internal rate of a bank. Some schemes have the rate calculated every 6 months while others have it fixed for the first several years.

Rates are lower for nationals or permanent residents of Cyprus

Credit payments are made on a monthly or quarterly basis.

To obtain a mortgage one is required to have life insurance (for the amount and period of the mortgage credit). The purchased property shall be insured as well.

The normal period within which a bank makes a decision on issuing a credit comprises 1-2 months upon receipt of all the required documents.

Documents for credit issuance

The standard set of information requested by a bank to issue a credit for immovable property acquisition in Cyprus includes:

  • Applicant’s personal information (personality, occupation, evidence that the applicant is not in the international search)

  • Income statement

  • Proof of income

  • Employer’s reference

  • Reference from a bank where the applicant has an account

  • Copies of bank statements for the recent three-six months

  • Contract of sale for immovable property

  • Copies of architectural plans of the property

  • Copies of payments already made to property vendor

  • Information on repayments per previously obtained credits

  • Copy of an international passport

This list is approximate and requires clarification with a bank in this or that specific situation.

 

Credit issued by a developer

As mentioned above the minimum term of a mortgage credit is 10 years. There are circumstances when a customer needs credit for considerably smaller period – for a few years or even less than a year. In this case we can provide our own credit for number of our projects. The feasibility and conditions of issuing credit may be discussed after you choose the desired property.

 

 

 

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