Croatian Mortgage

[LeoFish]

Hi,

I would like some help or advice regarding loans for house purchase in Croatia. I live in the US, not rich by any means but people seem to assume all americans are rich (not the case). regardeless, i do not own
a home here in California (priced out) but have savings, love croatia. So, therefore, i cannot simple 'refinance'. This means i would like to place 50% down and get a loan for the remaining 50% from a bank. American banks will not do foreign loans so that means either Croatian bank or some other bank.

I bought and read Martin Westby's book, which was fantastic, which stated that if one created a Croatian Company, one could get a Croatian Loan for 50% (at high interest at 8-9%). On another forum, Peter Ellis states this is really not the case, Croatian Banks will not loan to foreigners unless they have a 3 yr track record as a CRO company. This seems to conflict from Westby's book and Ellis.

I have searched these forums quite a bit. A woman named Nada suggested that an Austrain Bank can loan to foreigners. (Thanks Nada, if you read this).

How can foreigners get a loan to buy a house in Croatia besides refinancing their home in country of residence?

Thank you very much for any one that has done this before.

[Anja]

All depending on your personal circumstances, amount of deposit, and credit check, we might soon be able to help with your Croatian mortgage.
Please contact me for further info.
Best Wishes,
Anya
This is Croatia.com
[e-mail]

[LeoFish]

Actually I am looking for foreigner's experiences in financing through
Cro Company route. (Thanks though Anja).

Can anyone else comment? Or is everyone just buing through refinance (or savings?).

Thanks much

[balacleigh]

Traditional mortages secured on property are not yet available for foreigners. Banks don't yet offer these products and given the legal difficulties in buying property I guess this should not be a surprise.


I wish you well with your quest. Perhaps you could keep us posted if you have any luck.

Regards

[abbe]

what about traditional mortgages secured on the property
for Croatians? I thought that in general this was less common
in Croatia even for Croatians...

[Culchie]

Hi Leofish... do you intend to move and live in Croatia?

If not....is this a wise course of action?

Unless you are guaranteed enough rental income to cover your mortgage, then you are going to be paying your existing rent in California, and then addition mortgage repayments on your property in Croatia (unless fully covered by rental income). Then you will have management and utility charges and all the other incidental expenses that owning a property incurs.

If you are able to meet these Croatian expenses on top of your present savings, is it possible that you actually can afford a mortgage in your own USA, but you are just not saving enough?

If you are planning to leave USA and move to Croatia then the above does not apply, but residence regulations do...Will you be able to live and work in Croatia to repay your mortgage?

I don't think buying a property abroad before buying yourself s a good idea.

Maybe not what you wanted to hear, but you did ask for advice.....all the best

Culchie

[LeoFish]

Culchie said:

Hi Leofish... do you intend to move and live in Croatia?

If not....is this a wise course of action?

Unless you are guaranteed enough rental income to cover your mortgage, then you are going to be paying your existing rent in California, and then addition mortgage repayments on your property in Croatia (unless fully covered by rental income). Then you will have management and utility charges and all the other incidental expenses that owning a property incurs.

If you are able to meet these Croatian expenses on top of your present savings, is it possible that you actually can afford a mortgage in your own USA, but you are just not saving enough?

If you are planning to leave USA and move to Croatia then the above does not apply, but residence regulations do...Will you be able to live and work in Croatia to repay your mortgage?

I don't think buying a property abroad before buying yourself s a good idea.

Maybe not what you wanted to hear, but you did ask for advice.....all the best

Culchie

I plan on living there eventually (soon) but not in immediate future. Big Housing Bubble here. Average entry level house price here in San Francisco is $800,000+ (up to several million). No one, even decent income earners like me, can afford this. (you would have to make $140,000 per year and buy at top of the market)

I am looking to get around a $50-70k mortgage USD and repay this within a short amount of time (5 years) over and above my cost of living here. After all the bank would have a title and equity of over 50% at a high interest rate. If one defaults, the bank wins so this seems like a very safe bet.

When I do go there, I will open a business. I am an entrepruener. I would be bored do nothing. I would then apply for residency via business visa or some other method.

I would like to put 50-70% down cash now versus save while prices escalate.

So, I am asking if anyone has obtained a foreign or CRO mortgage through a reputable bank or loaning agent for home purchase without Refinance.

[malienglez]

Hi everyone,
I'm in almost exactly the same position. I'm
from London and lived in Croatia for about 5 years
where I met my wife who is from Zagreb. Since getting
married 6 years ago we have been living in London
where we have also been priced out of the housing
market. We have decided to return to Zagreb in the
next couple of years and would like to buy a property
now and rent it out until we decide to move back. So
to sum up we also need a local (Croatian) mortgage
based on my salary here. Does such a thing exist?
I would greatly appreciate any help.

Paul.

[mark2]

Hi all,

I don't know if Nada has contacted you, but I'll paste her email regarding Austrian Banks anyway.............


If you are buying a real estate in Croatia, you can get mortgage loan, does
not matter if you are buying with company or as private person, or if you
are English or Croat. The ownership has to be clear (I mean the person who
sells you have to have clear papers) and there have to be the building
permission if you are buying the new already made building. You can get
mortgages about 30- 50% of the price. Of course the Bank will check also
that you earn some money in England. If you buy the plot to build you can
get the loan for building, but again the papers have to be clear and you
have to have an building permission and already something made, then you can
get the rest to finish the building, but you get the money step by step and
the Bank control that the money is really invested in this real estate and
the building is done. Again about 30 - 50% of its real worth.
Yearly loan rate is 7, 5 - 9% depends on the area and the worth of the real
estate. Repayment 10- 15 years maximal, which decide the Bank.
For example if you take a loan from 20.000,-Euros; your monthly repayment
would be about 186 Euros monthly (interest and capital both) with 7,5%, 180
months, and 204 Euros if the rate would be 9%.


These mortgages are from Austrian Banks, so the process is fast, but some
things have to be made in Croatia with the lawyers and on the court in
Croatia- those are not that fast.

DOCUMENTACION NEEDED FOR MORTGAGES IN CROATIA

-Application for mortgages (including your personal data)

-Copy of the land map

-Land Registry extract (Zemljisko-knjizni izvadak original)

-Pre purchase contract or purchase contract notary verification (kupoprodajni ugovor ili predugovor)

-Estimate value (procjena nekretnine)

-2-3 photos or plans (if the building does not exist yet)

-Passport copy of property owner

-Copy of the company registration

-Balance sheet for last 2 years (Bilanca)

-Tax Statement (FINA Statistika –BON 1 i BON 2)

-Estimate costs for the investment (predracuni za investiciju)

-Proof of your own capital investment

-Proof of income from your country



Those are general documents, but are from case to case different, so describe your situation and you will get list of the documents we need.



Mortgages amount and repayment period

Maximal 50% of the real estate value (it is not necessary that the lender except the value from purchase contract or estimate value)

Repayment period 10-15 years



Rate

7, 5 – 9% yearly rate on Euros (depends from real estate and its location)



Time needed for mortgages process

About 40 days (we inspect each property)



Costs



-Notary fee about 0, 65% from the amount

-Land registry (we put mortgage marker on the property) fee is about 30GBP

-Translation from Notary act



-Lender fees 2, 8%

-Agent fees 3, 5%



-The property has to be fire insured to benefit of lender before the mortgage payment

-Some banks ask for life insurance for mortgages amount- from anywhere from EU



Those conditions are for all citizens that purchase or already own the real estate in Croatia.

No costs before the process and no costs if your mortgages failed from lender.



Example for monthly payment:

For 10,000 Euros mortgage by rate 7, 5% you pay by 10 years 120Euros and 94Euros by 15 years

For 10,000 Euros mortgage by rate 9% you pay by 10years 128Euros and 102Euros by 15 years