It's easy to think that buying a property in Hungary
is a good investment. At the very least, it won't be as expensive as purchasing real estate in countries such as the UK, Spain, and the like, right? Well, not necessarily! Any property in Hungary can still cost a pretty penny. So much so that the only way you can buy it is if you get a mortgage here. But how do you do it? What do you need to know about taking out a mortgage loan in Hungary? What are the conditions you need to meet? Will you need a local bank account? Here are some of the answers that will help you!
Do You Need A Local Bank Account?
This is probably the first question you're asking, right? Well, the answer is no, you don't, but it will definitely help! Hngary.com
notes that you have the option to take out a mortgage loan either in Euros, Swiss Francs, or Hungarian Forints. If you go for the first two, then you can easily handle it through an account in an international bank that also operates in Hungary. However, if you really want to safeguard your finances and keep your mortgage and other loans in check, you'd do well to open a local bank account
. You'll find it easier to handle everything if you have one!
Are There Conditions You Need to Meet?
All in all, the only condition you need to meet to get a mortgage here is that you're allowed to purchase a property in Hungary. And if you're a citizen from a non-EU country, this means getting the right permit from the local authorities. Other than that, you're good to go. Here in Hungary, financial institutions don't look at your identity, age, or income to determine whether they'll lend you a mortgage loan or not. They'll mostly look at the value of the property you're planning to buy. So on your end, as long as you're permitted to proceed with the purchase, there's nothing else to do but apply.
How Much Can You Borrow?
On the question of how much you can borrow, the answer is around 50% to 70% of the final property price. That's a lot, right? This is why they're pretty strict as to who they'll lend this loan to. And the fact that this is beyond your control makes it even more important that you do every step of the real estate process right. As long as you submit the requirements, sign the important documents, and more, you will get that mortgage. And eventually, you'll also get the keys to your new place in Hungary too.
How Long is A Mortgage Term in Hungary?
The mortgage terms in Hungary range from one to 35 years. It's up to the financial institutions to determine how long yours will be. But more often than not, it's possible that it will be the latter. And no, they will never extend beyond that. As already mentioned, they're pretty strict when it comes to determining whether you're worth lending the mortgage loan or not. So if your application is approved, they expect that you can, at the very least, repay the entire loan within 35 years. If not, you risk getting into trouble!
Buying a new property in Hungary can get so expensive that you'll have no choice but to take out a mortgage loan. But before you do, make sure you know a little about the process and if you're eligible to get it in the first place!