Mortgages for Croatia

[Mirko]

From a PR press release:

...As the only UK firm to offer mortgages in both Croatia and Montenegro, FFS can facilitate loans of 70% LTV for both UK and Irish buyers on completion. That FFS is the only broker to offer overseas property finance in these countries is indicative of the exceptional relationships and strong trust it has forged with banks worldwide. It has also engineered 90% LTV mortgages in Poland and special terms for newly formed companies in Romania, as well as staggering 100% LTV mortgages in Turkey".

Is this true?

[zorro]

I don't know but I wonder what the cost of setting up a mortgage like this would be? I was reading yesterday about how much it costs to set up a mortgage now. I think the cost of setting up a mortgage in the uk has risen by about 10 times in the last two or three years. I think one major bank is charging £5000 to set up a mortgage on £500 000.

All part of the knock on affect from America's bad debts?

[Carol]

There may be some playing with words heer on behalf of FFS because i got the following email this mornign from Hypo Aple Adrie in London. It starts:-

QUOTE
Dear Ms Southgate,

Thank you for your interest in our product. Yes, we do offer loans to non residents in Croatia.

Please find some info on loans to non residents in Croatia together with a list of personal and property related documents as well as application forms we need for the application.

Please note that loans are given only for the fully built properties, off plan properties can not be considered.
....

UNQUOTE

If anyone wants me to forward the email on, send an email (not a PM please!) to [e-mail]. The person sent me all the application forms etc. or contact Hypo direct - they have a website

[darcy]

I doubt there are any real deals for Croatia. You might find one, but the costs should be very high. In general, banks do not like to lend outside the country. I would rather expect for Croatian banks to offer loans and market them in the UK or elsewhere.

[Carol]

that is more or less what this is, except its a german owned company with a banking licence in Croatia (as opposed to an Italian owned/ french owned/ Austria owned company with a bank licence in Croatia)

[zorro]

kind of like a Croatian bank then? It would have to be a brave bank anyway to lend money on property abroad don't you think? I mean is it really feasible. Where I have my apartment two families moved out because they couldn't afford their mortgage and they were Croatians banking with a Croatian bank, so I think this is all a big red herring.

[Carol]

you might be right. Hypo have been lending for some time now - maybe 18 months or more. Has anyone reading this actually applied for a loan from hypo in London to buy a Croatia property and got it?

[crogirl]

Also will they lend if you have not yet received permissions from MFA?

[nikh]

Hypo In Split explained to my fund that it is a leasing product and Ministry approval is a prerequisite, although they are interestingly flexible. They told me that London contacts them when they get a new query

[valiant]

Mort...the first syllable of the word Mortgage is probably derived from the latin(death).

[Nick]

We have established the possibility of getting a mortgage from Hypo for Dutch and Belgium purchasers. No done deal yet, but the conditions are different from your letter from Hypo in London. Dutch and Belgium purchasers can get up to 70% on off plan as well. The problem is that they only give a mortgage if the property has a kadastral number. If you buy an apartment this number is not issued untill the developer has obtained the 'etagierung' (the dividing into apartment rigths). That appeal can only be done after the developer has obtained the 'usage permit', wich in its turn can only be obtained after completion of the karkass of the building.

However it is possible to get approval for the mortgage off plan, but the buyer will have to pre-finance the first installments. that is the information/situation so far and it is surely to change.

[zorro]

valiant said:

Mort...the first syllable of the word Mortgage is probably derived from the latin(death).

"death pledge" apparently so you cannot escape paying the debt.

[balacleigh]

Dear All,

Has anybody ann update on the situation in securing a mortgage on a property in Croatia ? Has anyone done it and how was the process / terms ?

Many Thanks in advance. Balacleigh

[bheywood]

My wife and I recently completed a loan through the Hypo Group on a house we bought four years ago. It was reasonably straightforward, actually, and we received a much more personal service than we received from our UK lender. The rate was 7.8% and included a 2% set-up fee. It's more expensive than a UK mortgage, but it's in Euros, which given the current economic climate was the reason for taking it out (wanted to split capital for some renovation work between £ and €).

I reckon that the best value way to borrow is still by using equity from your UK property (better rates, at least for now), but once you've exhausted that option the Hypo Group's deal isn't so bad. The only caveats are the 70% LTV being a bit mis-leading as the valuation is often 50% of the property's true value - and that you absolutely have to have all your paperwork from the MFA/cadastre.

[Carol]

does this mean you cannot get a hypo loan to BUY a property, only to release capital on a property you already own (and after the katastar has been updated?)