The
choice of UK or Bulgarian mortgages is a difficult
one. Both countries have only a limited number of lenders who
work with the Bulgarian/UK market.
Perhaps a better option for many UK buyers is to consider remortgaging
their present UK home and using the equity to purchase their
Bulgarian property in cash.
Given the low prices of many Bulgarian properties, this can
be surprisingly practical and should allow you to benefit from
fairly favourable terms on your UK mortgage - probably more
favourable than those on a Bulgarian mortgage.
Getting Mortgages In Bulgaria
The
mortgage market in Bulgaria is not as well-developed as in some
other European countries and there are only a restricted number
of lenders in the UK and in Bulgaria who will approve a mortgage
on a Bulgarian property for a foreign non-resident.
It is worth noting that it can take up to 12 weeks to get approval
for a mortgage in Bulgaria - make sure you start this
process in good time, as you may face penalties if you are not
ready for the scheduled completion date on your property.
On the other hand, the situation is better than it used to be
and it is possible to get reasonably competitive mortgages for
a property in Bulgaria. Typical mortgage terms from a Bulgarian
bank might be:
70% - 80% of property's value
Fixed interest rates
Repayment mortgages only
Mortgages in either Euros, US Dollars or Bulgarian Levs
20 year mortgage term
1%
- 3% arrangement fees
Bulgarian bank account required
In reality, these terms are not that different to those offered
for foreign buyers in several other European countries, and as
the Bulgarian property market continues to develop and open up,
competition amongst mortgage lenders is likely to improve the
deals that are offered to foreign buyers.
If You're Employed
Employed people looking to buy in Bulgaria will have to provide
proof of their income and employment - just as in the UK. Typical
requirements are at least: Last 3 months' payslips
Last 6 months' personal bank statements
Employer reference stating salary
Last 2 years' P60s
Copy of passport and proof of permanent address
You may also have to provide a copy of your marriage certificate
(if appropriate).
If You're Self-Employed
Self-certified (non-status) mortgages do not exist in Bulgaria
and self-employed applicants will have to provide full details
of their business, as in most other European countries.
Typical requirements might be:
Last 2 years' audited accounts
Last year's tax return
Last 6 months' personal and business bank statements
You will also need a copy of your passport and may be asked
for a letter from a chartered accountant providing details of
your drawings from your business.
Rental Income
While renting properties in Bulgaria is popular and can be profitable,
Bulgarian lenders will not normally take into account potential
rental income when considering a mortgage application.
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