Cyprus Mortgage: Housing Loans & Financing Options
Cyprus benefits from a warm climate, a steady economy, high standards of education, and low crime rates. Cyprus is an ideal place to have a live and work balance, retire, or raise a family. Due to the advantageous property tax rates, Cyprus is also a favourable choice for those looking to secure a second home or holiday apartment, whether for investment or leisurely purposes.
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Eltoma Corporate Services can assist both residents and non-residents with obtaining a mortgage for property or land in Cyprus and the entire application procedure with our associate banking partner, the largest lender in Cyprus. A precondition for obtaining a mortgage in Cyprus is that the purchaser is required to present a down payment of approximately 20% - 40% of the total purchase price of the property. Depending upon the conditions of the relevant application, the credit rate can vary from 2.2% – 2.5% for individuals and 5.3% for investors and housing developers.
Timeframe for Mortgage Applications
For the average mortgage application, bank approval procedures range from approximately 3 weeks to 1 month.
Documentation Required for Loan Application:
- Tangible evidence to show the ability to sustainably repay the loan.
- A copy of the applicant’s current & valid passport.
- A Personal Financial Statement should be completed and signed by the applicant. The debt to income ratio must be no more than 30%.
- A bank credit reference if possible, as this demonstrates strong proof of credibility.
- The last 12 months bank statements from all valid bank accounts, i.e. current, savings or loan accounts. The bank is especially interested in the main account where salary or other income is transferred.
- A tax declaration form for the previous 3 financial years.
- The last 3 months’ pay-slip or recent employment contract.
- Proof of permanent address (a valid rental agreement or utility bill).
- The relevant title deeds need to be transferred from the previous owners or property developers.
- A building permit is required if you plan to change the structure of the property.
- Property Valuation Report (to be executed by the bank).
- A copy of the property’s title deed is presented to the Bank with written instructions to proceed with the valuation and the debiting of the property down payment as previously agreed.
- Customers must complete and sign the Loan Application along with a Personal Financial Statement. The two documents must be presented to the Bank together with the other documents mentioned above that will determine their repayment ability. Contact us for a copy of these forms.
- Once all documentation has been verified and taken into consideration; Eltoma Property will then set up a meeting in the final stages between the applicant and bank to discuss any further details and address any enquiries.
The loan will be secured as follows:
- If the property has a separate title deed, the mortgage will proceed as above. Applicants must have already been accepted by the Cyprus Government to purchase the property.
- If the property has no separate title deed, the process is somewhat longer. With the assignment of the Sales Contract and guarantee from the Seller accompanied by a Waiver for the issuance of the title deed.
- Assignment of an insurance policy for the amount & duration of the loan.
- Any personal guarantees (if applicable).
Fees & Other Expenses:
- Arrangement fees: on the loan amount.
- Documentation fees: €75-€100 (based1% on the loan amount and type of applicant).
Once the loan is approved, applicants are required to sign the loan contracts in person via the bank. If abroad, the signing can also be arranged in the premises of a Cyprus or European Embassy, however this delays the procedure somewhat.
Read more about obtaining a property in Cyprus.
Contact us for more information.