Hi. Started a thread on this in another room and it got deleted so maybe it will survive here. No need to mention banks or anything, but does anyone have experience of mortgage interest rates from various financial institutions for various currencies? I was given a rate on a EUR mortgage of over 8% the other day from someone. I thought that was very high.
A current and competitive EUR mortgage (available to foreigners) would be with Millennium Bank at 6%. That is comprised of EURIBOR base rate of 4.95% as at 30/06/2008 with the bank margin of 1.05% added for a mortage of more than 100 000 PLN with a LTV of 50-80%.
i do not recommend millennium at all, they require all documents in english to be translated in to polish, the max ltv is 80% with higher lending charge. margin is low but the translation is quite expansive, and when you do the translation the most of the documents will expire. i recommend bank which accept documents in english and has minimum paperwork
i do not recommend millennium at all, they require all documents in english to be translated in to polish,
lol, what do you expect, of course they have to be translated we live in Poland unless you didn't know that!! Do you think a Polish person buying a house in the UK would be allowed to have his documents in Polish, of course not.
morgage depend if it's in EUR,PLN,USD or CHF.In Poland is higher than in others country. If i have good current information in CHF are smaller (CHF is more stable).I took morgage twice in CHF to buy property
As a fellow mortgage broker in Poland, I would agree with the comments from Daniel at Rednet - Metro/Noble Bank (and Dom Bank) should really only be considered as banks of last resort - in most cases, foreigners can get much more competitive offers from other banks, such as the ones below.
1st bank offer 80% LTV in GBP/EUR/USD/ over 20 years or 60% LTV in CHF over 20 years Current interest rates (based on base rate + bank margin) GBP: 5,82% + 1.75% = 7.57% EUR 4.95% + 1.75% = 6.7% USD 2.79% + 1.75% = 4.54% CHF 2.8% + 1.75% = 4.55% Loan commission 2% (taken from loan amount) but no repayment penalties.
2nd bank offer 80% LTV over 20 years / 90% LTV over 15 years in PLN only (no foreign currency mortgages). Current interest rate: 6.81% + 0.65% = 7.46% No loan commission. Repayment penalty up to 2% of loan value only applies for repayment during first three years.
3rd bank offer Up to 80% LTV over 20 years in PLN, CHF, EUR, USD. PLN: 6.65% + 0.9% = 7.55% CHF: 2.79% + 1.05% = 3.84% EUR: 4.95% + 1.05% = 6% USD: 2.78% + 1.05% = 3.83% No loan commission at present. However, a high LTV insurance payment applies - based on one-off payment of 3% of difference of loan amount above 60% LTV. For example, 60% LTV = 255000 PLN and 80% LTV = 340 000 PLN, the difference being 85000 PLN. The insurance would equal 3% of 85000 PLN = 2550 PLN.
Repayment penalty up to 2% of loan value only applies for repayment during first three years.
In all cases, the bank's interest rate is increased until the time that they bank is registered against the title deeds on the property, which can be 3-6 months after the final purchase contract is signed.
Regarding the documentation requirements, the easiest bank to deal with will be the second, followed by the first and then the third.
1st bank offer- If i wanted a mortgage in USD and i had paid the developer hypothetically a 10% deposit on a 400,000zl off plan property a year ago that had not risen in price ,does its criteria mean that i would have to find another 40,000zl
or at current exchange rates ,approxamately £10,000 from my own resources to put down before the bank would grant me a mortgage if the property was ready for completion ?
2nd bank offer- Is this a better interest rate in PLN than if you borrowed from Metrobank in CHF ?
3rd bank offer- ditto 1st question
Final question- Would you say that the monthly mortgage repayment on 4.54%, 7.46% and 3.83% repayment mortgages from above will be lower than a interest only mortgage at 5.6% ?
incredible are your words!!!!i will say it again: you sounds like very rude,coarse,boorish person!!!!!people just asked here how to managed things!!!than if you don't have nothing for saying better say nothing!!!!
Are you Pole (I am)???!!!!!!you should be ashamed of yourself becouse i'm ashamed of you!!! k
1st bank offer- If i wanted a mortgage in USD and i had paid the developer hypothetically a 10% deposit on a 400,000zl off plan property a year ago that had not risen in price ,does its criteria mean that i would have to find another 40,000zl
Yes, that is correct.
2nd bank offer- Is this a better interest rate in PLN than if you borrowed from Metrobank in CHF ?
Possibly! We don't actually deal with Metro Bank, so I am not 100% sure on the specifics of their offer. Actually, we had a visit in our office recently from a very arrogant man from Metro Bank. He tried to sell us their offer, but fell over when he offered to pay us only 20-30% of the commission that the other banks pay. He was sure we would still want to deal with his bank, because as he pointed out, they would grant loans in cases when all the other banks wouldn't. We didn't agree! My employee had a good look at their loan offer, and from what I remember him saying, there seems to be lots of hidden charges and fees with titles such as 'compulsary insurance'. So with any loan offer, the interest rate is not the only factor to take into account.
3rd bank offer- ditto 1st question
Same answer.
Final question- Would you say that the monthly mortgage repayment on 4.54%, 7.46% and 3.83% repayment mortgages from above will be lower than a interest only mortgage at 5.6% ?
Doesn't seem to be a good idea, there's a serious risk that USD will become stronger... also soon mortgages in JPY should be available in Poland - they are cheap but smart people say that this is not a good option as the exchange rate risk is very serious - little connections between Polish and Japanese economy... In my opinion for people living and making money in Poland, CHF seems to be defiantely the best option, quite cheap and safe.
I have two mortgages from DomBank and most foreigners I know of who bought properties in Poland have done likewise.
There is a good reason for that. 3 or 4 years ago it was virtually impossible for a non resident foreigner to get a mortgage in POland. Dom bank were among the few ones offering their deals through Open Finance.
A few other banks did too (BZWBK springs to mind but the amount of papers they required was hilarious) but as a matter of fact, Dombank rates were among the most competitive at the time.
Obviously things moved on a lot since then.
Point taken though. I will apply for 3 mortgages by year end for properties due to completion in 2009 and I will certainly use your services.
Hi Andy b, Thanks for the answers.The reason i asked those questions was to illustrate the fact that Metrobank is not necessarily a last resort.I can have a LTV of 90% with them whereas with 2 of your options i would have to find an extra10% from somewhere and your second option is more expensive with the 90% LTV than i am getting with Metrobank.In addition because of my 5 years interest only ,my repayments monthly will be lower than all of your examples on the same amount borrowed.This means that my yield will be higher as a result.I believe most serious BTL investors would go for the Metrobank option compared to the examples you gave if given an option.
you have right but metro in my opinion is still to expensive.
90% Ltv is not only available in metro in CHF, margin 2,95% in CHF it too high
when you made a calculation you will see that the interest only installment is even higher with the capital + interest installment in other bank.
the metro is very flexible and this is a big advantage if this bank
the 20 yrs term of the loan is not profitable for the customer. the longer term the lower installments. the lower installment the more will left in the pocket when the apartment is rented out.
there is a lot of factors that investor should taken in to consideration choosing the bank. it might happen that metro will be the best option
Kneehawk, you make some valid points, but at the end of the day, it comes down to the personal choice of each investor. I am guessing that you are quite an agressive BTL investor, so fair enough that you would go for CHF and also take 5 years interest only. Other BTL investors will be more risk averse, and so will perhaps elect to take a lower LTV mortgage and also choose a repayment mortgage. I guess those are the kind of investors who we can help the most.
To illustrate the points made by Daniel and myself that the interest rate is only a part of the loan offer to consider, I have had a more detailed look at the Metro Bank offer to make sure I found all the "charges" associated with it.
The offer I have expired on 8th June, though I expect that the current offer is pretty much the same.
The bank says that there is no loan commission. HOWEVER, there are two other charges.
1st: Insurance against adverse movement in the base rate (e.g. LIBOR for CHF or WIBOR for PLN). If there is an increase of more than 200 basis points (2%) in the base rate, then you are insured. It doesn't state how much you are covered for. However, the cost is 1.5% of the loan amount for CHF mortgages and 1.95% of the loan amount for PLN mortgages. It is automatically taken from the loan amount paid out. The insurance looks to be compulsary for CHF loans, and not compulsory for PLN or other loans.
2nd: High LTV insurance. If you want to borrow at more than 75% LTV, then you need to pay 3.785% of the difference between your contribution and the amount above 75% for three years upfront. For example, if you want 90% LTV, then you must pay 3.785% of 15% of the loan amount for three years upfront.
The difference above 75% and your contribution = 60 000 PLN. 3.785% of 60 000 = 2271 PLN x 3 years = 6813. As a percentage of the loan amount, this equals 1.89%.
In addition, there are higher early repayment penalties, starting at 5% of the loan amount in year 1, and falling to 1% by year 5.
Until the bank is registered on the new property deeds (księga wieczysta), the interest rate is increased by 1%. Pretty much all banks in Poland have a similar fee.
Hi andy b, It is very straightforward obtaining a mortgage in Poland for one or two properties if you can demonstrate a regular income and affordability.It is a different kettle of fish if you are self-employed,your application is asset based,or involves multiple applications.The Polish banking sector has developed significantly in the last 18 months ,but has someway to go in meeting the needs of serious property investors without ripping them off.
@kneehawk JW Constructions, 1 at Lewandow Park and 2 at Osada Wislana. Or vise versa, cant remember.
@Andy b. BTL investors are by definition aggressive, and most of them would take a 100% LTV mortgage any day even if the rates are somewhat higher. Costs aren't an issue if they can be covered by the mortgage and the mortgage spread over a long maturity to keep repayments low. Problem with lower LTV mortgages is that the initial deposit kills u and ultimately reduces the number of properties u can get.
I personally wouldn't even bother listening to any bank offering less than 80% LTV even if it were at 3%. Pt is to get the highest LTV and the longest possible maturity. The level of interest rates is a secondary concern to the LTV and maturity.
A highly geared portfolio might be risky but in my view, no pt in going into BTL seriously as a business if someone is not comfortable with high gearing.
The Polish banking sector has developed significantly in the last 18 months ,but has someway to go in meeting the needs of serious property investors without ripping them off.
You are not exactly telling me anything here I don't know! I started this brokerage in Krakow three years ago with a business partner, and have been doing it on a daily basis, together with selling off-plan to foreign investors and managing a local agency, so I am well aware of the difficulty which foreigners have had in obtaining finance in Poland.
It all depends how long you have owned it for. Unfortunately, I don't know any Polish bank that will re-mortgage if you have owned the property for more than 2 years.
If you have owned it for less than 2 years, the application is pretty similar to any other, apart from the need to get a valuation done - the bank will normally refer you to valuers they accept
It all depends how long you have owned it for. Unfortunately, I don't know any Polish bank that will re-mortgage if you have owned the property for more than 2 years.
i know :)
if you refinace your loan the procedure is even easier , you do not have provide any financial documents, bank accept only statement that you work and the conditions are very very good: 0% bank commission, 1% bank margin
if somebody has a metro it is a very good offer to refinace it, but we have to remeber about repayment fee in metro :( in metro there is 3rd and 4th cost: 3rd: spread 8,33% 4rd: refundable cover/deposit which is 3 or 5 multiply by your installments =deposit. it is not a cost but this money you block
