For many, purchasing a home or apartment requires a significant financial commitment.It is advised that you make sure you have some impartial guidance and support to get you through this.Getting together.Make contact with a few Romanian real estate companies, let them know what you’re searching for, and request that they send you properties. Find out as much as you can about local prices in the area you want to purchase. Arrange to visit properties with agents or sellers.
Selection of Properties
Once you have identified one or more properties that pique your interest, you will need to decide whether to go to Romania to inspect the properties and make your final selection, or to reserve the property through an agent without visiting Romania. Purchasing an item before seeing it is not advised.
Reservation
After you’ve chosen the property you want to purchase, you can reserve it with an agency via mail, email, or in-person consultation with a representative. Following then, the property will be held for 15 days. You select a solicitor or attorney during this time to assist you in the next steps of the purchasing process.
Purchasing
The purchase agreement becomes a public record when you buy a property. A public notary must witness the signature of a contract before submitting it for certification by the Land Registry, which is in charge of maintaining real estate records.
Mortgages and Loans
Non-Romanian citizens who have a valid contract can now apply for mortgages in Romania. To obtain more precise information, review bank offers. The length of time is often between 25 and 30 years, and the credit limit is determined by your income. In addition to other requirements, banks typically ask for building insurance, a minimum deposit (some charge 15%, others 25%), and an analysis fee.
For the first three years, you have the option of variable or fixed interest rates; thereafter, variable rates apply.
Varying Rates of Interest
If you decide to collect the income in your OTP Bank account, the yearly interest rate ranges from 8.28% (which is composed of the IRCC index and the fixed margin of 2.31%) to 8.98% (which is composed of the IRCC index and the fixed margin of 3.11%).
Initial Three Years of Fixed interest, Followed by Variable
If you want to receive the income in your OTP Bank account, the annual interest rate is variable after the first three years and is fixed at a range of 5.79% to 6.49% (consisting of IRCC + fixed margin between 2.39% and 3.09%).
Based on the amount, the interest rate is decided upon at the time the loan is approved. In case you decide not to receive the income in your OTP Bank account, the interest rate will increase by 0.6 percentage points. Here is a link to the comprehensive list of interests.
How to Apply for a Mortgage Loan
Visit any OTP Bank branch in your community to talk about your best options.
Some things to think about for eligibility are be older than 24 when submitting the application, but no older than 70 when the loan matures in full. Individuals who turn 65 on the ultimate maturity date must show proof of life insurance that is in effect as of the signing date, assigned to OTP Bank, and effective for the duration of the contract.
possess a minimum of three months’ worth of continuous employment at the current employer over the course of the previous twelve months, or – At least half a year of experience with the present employer
You have been active for at least a year if you have a PFA.
Seniority is discussed in the Territorial Units and is contingent upon the sort of revenue submitted for the other forms of income that are approved, as outlined below.
Which is More Profitable, a Mortgage Loan or Rent?
The goals and aspirations of the prospective buyer strongly influence the type of real estate ownership that they select. One of the finest ways to spend a lot of money is to invest in real estate, therefore people who view purchasing a home as an investment should consider obtaining a housing loan. However, this alternative necessitates large savings because the laws in these three jurisdictions expect a 20–30% down payment at signing. One advantage of a mortgage loan is that you can rent out an item while making payments, which allows you to move in yourself when the installment plan is closed and generate cash while settling tenants.
Renting is a good choice if your financial circumstances prevents you from making a sizable initial payment. For individuals who do not intend to remain in the country for an extended period of time, renting a home or apartment is more advantageous. If one intends to live in Bulgaria, Romania, or Slovenia permanently, renting a place for the first time, saving up the required funds, and buying an item with a mortgage are the best options.
The Price of Leasing a Residence
The pricing structure for renting residential structures is essentially the same in these three nations: monthly rent in Bulgaria is from 350 to 700 euros, while in Romania, prices are slightly lower at 200 to 700 euros. Slovenia has the highest real estate rental prices of all three nations, ranging from 380 to 800 euros. Remember that the cost varies not only by state but also by the area selected; for example, an apartment in a town or suburb will cost far less than one in the capital or a large metropolis.
Terms of a Mortgage Loan
Since the welfare of its residents is the top priority for every state, banks provide more hospitable conditions for them than for foreigners. If a foreign national is thinking seriously about taking out a mortgage in installments and then relocating permanently, he might want to consider getting citizenship first.
Bulgarian mortgage
In Bulgaria, mortgage applicants who are older than 21 may buy a residential property. If the borrower is a man, the final payment must be made before the age of 65; if the transaction was completed by a woman, it must be made before the age of 60. There is a five-to twenty-year installment schedule. You can arrange to pay between sixty and eighty percent of the apartment’s total cost in installments. This indicates that 20–40% is the initial payment. The Bulgarian lev, the country’s currency, is used to issue the loan. The buyer is required to pay for utilities on a regular basis in addition to returning any required payments to the bank. Depending on the bank, interest rates typically range from 7 to 15 percent. It’s important to carefully review the terms of issuance in a specific bank as the bank may raise the interest rate over time.
150 thousand euros is the maximum sum that can be distributed in installments. Early repayment is an option; in this scenario, a commission of up to 5% of the remaining amount is paid by the buyer. The object’s insurance is a requirement before completing a transaction. The borrower’s life can also be insured, albeit this is optional and has no bearing on the interest rate. The purchaser will pay between 100 and 300 euros a year for each of the insurance plans.
Romanian Mortgage
For a maximum of 35 years, a foreign national may apply for a mortgage in Romania. At least thirty percent of the object’s cost is covered by the loan, or seventy percent of it. Romania has the lowest proportion of these three countries’ average annual interest rates for mortgage loans secured by real estate, at 4.41%. You have to have insurance on the item before you can complete a transaction.
Slovenian Mortgage
Slovenian mortgages have the lowest loan terms—just ten years—among these three nations. A minimum of 40% of the total cost of housing must be paid as the first payment; however, some banks demand 65%. In Slovenian banks, a mortgage loan carries an average annual interest rate of 5%. Installments may be made to a legal entity in addition to an individual. The insurance of the item is a must; in the event that it is not, the buyer will be refused credit, same as in the past. Life insurance is a desired but optional item. You might anticipate more devoted circumstances if you possess this insurance.
