Mortgages in Bulgaria

Property in Bulgaria 

The real estate market in Bulgaria is relatively unexplored and offers incredible investment opportunities. The prices of the properties in Bulgaria are increasing by about 20-30% every year and according to the market research the trend will continue until the country joins the European Union in 2007.

Full status mortgages are based on affordability, and all your existing liabilities including any mortgage/rent payments, personal bank loans, credit card payments etc together with your proposed Bulgarian mortgage payment must not exceed 40% of your net monthly income.  

In some cases a percentage of Rental Income may be allowed.  Please note however, it is not always the case that the Lender will take all or part of these Incomes into account when determining the maximum loan available.

Bulgarian mortgages what is available   

Types of Mortgage: Repayment only Minimum: €25,000 loan amount - No Maximum, but must not exceed 70% of valuation or purchase price (whichever is the lower) Proof of Income: Required in all cases. Mortgages need to be supported by a minimum requirement of proof of income, i.e. if employed – copies of your last six month’s payslips & copies of your latest two P60’s together with copies of your last 6 month’s Personal Bank Statements.  Alternatively if you are self-employed – copies of your last three years Audited Accounts & copies of both your last 12 month’s Business and last 6 month’s Personal Bank Statements will be required on application. Term: 20 years up to age 70 Currency: Euros only Current Variable Interest Rate: from approx 6.2%Example for Euro Mortgage: Repayment mortgage of approx €100,000 over a period of 20 years at an interest rate of approx. 6.2% = approx €728 capital and interest per month = a total approximate amount payable over the term of €174,720  excluding other fees.  

Apply for a Bulgarian mortgage quote

Bulgarian mortgage

Bulgaria mortgages

Max 70% LTV

Term 5-20 years

Minimum loan €25,000

Euros only

Repayment only

Max age 70

Rates from approx 6.20% 

Buying property in Bulgaria 

Buying property in Bulgaria will mean in most cases that overseas property buyers will need to set up a limited company. The exception to this is when a buyer purchases a leasehold property such as an apartment. In this case you do not own the land and therefore foreign buyers can buy Bulgarian property without the need to set up a Bulgarian registered company.

How to set up a Bulgarian company  

Setting up a limited company in Bulgaria is such a normal process that it is now a relatively easy process. Many Bulgarian estate agents will do this for you as part of the service. After all it is to their benefit as buyers cannot proceed without the creation of the company. You will need to consider the cost of this service and like most things it varies from agent to agent. 

Once registered your company gives you bargaining power it can put you in an excellent position as you are ready to buy. It demonstrates to the seller that you are a serious buyer that can buy a Bulgarian home relatively quickly.  

Your ownership rights are the same as if you bought the property as an individual. Whoever owns the company also owns the land. These rules are set to change in 2007 after Bulgaria joins the European Union

Words of advice  

Before you enter into any property purchase you should consider the following things:-Appoint a good lawyer who can carry you through the process till completion Only buy what you can afford. Do not overlook Foreign Currency Fluctuations and all closing costs. Make sure you have a good Idea of what mortgage you will be able to secure prior to entering into any contract to buy Remember that when taking out an overseas mortgage you will have to declare full details and your assessment will be made on the affordability to pay and not income alone

Mortgages in Bulgaria resources