Most people and businesses purchasing a new home or other property (hotel, AirBNB, investment property etc) will need to finance their purchase with a loan or mortgage. Even if you are a cash buyer with the capability to pay cash (by that we mean through online transfer, not real cash), then you may still consider a mortgage for tax or other purposes such as currency rate hedging.
In Greece, depending on what home country you are from and depending on the type of your income, your age, and a number of other factors, it is possible to get a mortgage as a non-resident, or as a foreign Greek resident.
In this guide, we will talk about what process you generally need to go through to get a mortgage or home loan in Greece. These obviously differ, with some banks having different requirements to others, some banks being more stringent, and some banks not recognising certain foreign income. However, many of the requirements are the same or at least very similar.
The interest rates also differ based on the level of risk to the respective financial institution and the amount borrowed. However, as a guide, interest rates on home loans start from 3.5%. If you are a Greek resident, it’s generally much easier to apply for a mortgage in Greece and the criteria are less onerous. On the other hand, for people living abroad, given the added risk, the banks apply much stricter requirements and a more complicated approval process. Some banks also require you to have your tax residence in Greece although this is not all banks.
In addition, many banks ask you for two years history of tax returns in Greece in order to be eligible for a local loan (with lower rates and a less complicated approval process).
Home loan and mortgage requirements in Greece
There are many different requirements to get a mortgage or finance a property or project in Greece. Some of the key ones are:
- You must be under a certain age (for most banks this age is 75) at the time the proposed loan will end. This is a critical point as many clients who are 70 years of age, even with very high incomes, often struggle to secure a loan on a property.
- You need to have enough income to cover the cost of the loan including the monthly interest as well as the payment of the principal amount.
- You need to have a Greek bank account in order to get the loan as well as an AFM. It’s important to note that even if you have a Greek bank account with one bank, there may be a most cost effective loan available with better conditions with another bank. Therefore, you should speak with us about your best options and the lowest rate, as opposed to simply speaking with the bank you currently bank with.
Other factors that will have an impact on what interest rate you will get include:
- Your income and the value of the property
- If you are a Cyprus or Greek Citizen
- If you are intending on repairing, building or renovating the property – as there will be value-add involved in the property.
- If you are looking at getting a fixed or floating loan rate.
What documents do you need to apply for a mortgage, home loan or finance a property in Greece?
All banks have different requirements, however, some common documents which (nearly) all banks will ask for as part of the loan process in Greece includes:
A copy of your ID or passport
- A Greek Tax Number
- A letter of employment or proof of income. If you are a freelancer, then you will need a proof of establishment for your freelance entity, and if you are a company, your company tax returns.
- Proof of your current residential address.
- Tax returns for the previous two or three years.
- Credit reports from your country of origin.
- Proof of tax payments.
- Documents and certificates to show any existing assets or a statutory declaration that you do not own any other property in Greece.
- Any mortgages you currently have.
- Copy of your passport or other identification (for example, taftotita or ID card)
- Statement of your assets and liabilities, confirmed by an accountant
As part of the mortgage application process, you generally need to get this documentation apostle.
Can you get a Mortgage or Home Loan in Greece if you are not a Greek resident?
Yes you certainly can. Although the process can be a bit more complicated and challenging, you do not need to be a Greek resident in order to apply for a mortgage or home loan in Greece.
Do you need a Greek bank account in order to get a mortgage in Greece?
Yes – you certainly will. You will also need an AFM (tax number) and you will need to be set up in the Greek tax system.
What percentage of the property value can I borrow in order to buy a home or holiday home in Greece? Can you tell me how much I can borrow?
It usually depends on if you are a Greek Tax resident or a non-Greek tax resident. If you are a non-resident, then you usually can’t borrow more than 50% of the objective value of the property. Each bank has slightly different requirements, and our mortgage brokers can advise you on which bank offers the best terms and rates.
If you are a Greek tax resident it is a bit different. You can often borrow up to 80% of the property value depending on it’s location and some other factors.
Either way, as part of the process, the bank will conduct a number of checks involving civil engineers, lawyers and topographers.
What banks provide home loans, finance and mortgage facilities in Greece?
There are many Greek banks that you can go to for a loan and our brokers understand the advantages and disadvantages of each. Examples include:
- They offer up to 50% of the value for non-residents, and higher for residents. They have interest rates (at the time of writing) starting from 3% fixed for three years and recognise income from a range of different countries. They also have well established foreign loan processes.
- National Bank of Greece. They require you to be a Greek tax resident in order to apply for a loan. They have a minimum loan amount and similar interest rates to EuroBank. They are generally easy to deal with and if you are a Greek tax resident, they will treat your application like that of any local Greek.
- Bank of Piraeus: They are selective in terms of the foreign income and tax returns which they acknowledge. The loan application process is relatively straight forward and their rates are competitive. Your residency status has an impact on your prospects of success.
- Alpha Bank: They are similar to the other banks and have differing loan requirements based on energy class. Alpha bank has a few more factors that impact the interest rate you are offered.
What is the process of getting a loan, finance or mortgage for a home in Greece
- Contact our team so we can get an initial understanding of your situation and requirements can recommend you a suitable bank manager or mortgage broker
- Prepare and gather all the necessary information that you need for the application. You will be provided a list of documents for this. This will build your financial profile in the eyes of the bank and will show your income, other assets and credit history.
- Ensure you have your initial deposit ready. The higher your deposit, the more your are able to borrow and the easier it will be to have a loan approved.
- An application for pre-approval will be made. This will ensure all the documents are correct and the set amount of money you would like to borrow will be allocated. Pre-approval comes in the form of a letter for the specific banking or financial institution.
- Find the property you wish to purchase and a arrange a property valuation.
- Complete the mortgage application and transact.
There are also a number of other steps involved in a property purchase that are beyond the scope of a mortgage application. For example, inspections and certifications by civil engineers and legal inspections and checks.
How can the Tsaks Consulting mortgage broking service help you
Our team will help by ensuring you speak to the best mortgage broker or the correct bank manager than can process your loan quickly and efficiently. It is important that you understand which bank is able to assist depending on their criteria and your individual situation. It is equally important to understand which branch of the bank to deal with so that your application is processed quickly and efficiently. Our team can assist you with this.
Contact our team members today to talk about how we can assist. We help:
- American or American Greek citizen or foreign resident looking to secure a loan, mortgage or financing for a house in Greece
- Canadian or Canadian Greek citizen or foreign resident looking to secure a loan, mortgage or financing for a house in Greece
- Australian or Australian Greek citizen or foreign resident looking to secure a loan, mortgage or financing for a house in Greece
- European or European Greek citizen or foreign resident looking to secure a loan, mortgage or financing for a house in Greece
- All other citizens, residents and no-residents