Mortgage and Finance in Turkey - Payment Plan Property
Buying a property is one of the most important investments that most people make in their lifetime! Evaluating the financing options that suit you can seem complex. Deciding whether to use a mortgage opportunity, choosing the right mortgage product and then the payment plan that will suit your objectives, needs and budget is as important as finding the right property. We are here to solve your doubts.
As a foreign national living abroad you can access a wide range of Non-Resident Mortgage products whether for residential or investment purposes.
TERRA Real Estate has been cooperating with some quality and trustworthy Turkey’s High Street Banks have arranged a brief overview of the mortgage in Turkey currently on offer. All of the information below is fully up to date.
What is a Mortgage?
A mortgage is a loan that is provided by a mortgage lender or a bank. While it's permissible to take out loans to cover the entire cost of a property, it's more common to secure a loan for some per cent of the property value. The loan must be paid back on time. The real estate purchased stays as a guarantee for the bank.
What are the Conditions to Get a Turkish Mortgage for Foreign Buyers?
- According to the newest Turkish Law up till 2019, a foreigner can get a mortgage from a Turkish bank ONLY with TL currency (Turkish Lira). Turkish banks do not give a loan in any foreign currency.
- European and other countries citizens (except Iran and Syria) can claim a mortgage loan amount up to 65% of the value of the property
- The exceptions are Russians, for whom the loan ratio is 50% of the property value
- The value of the property is calculated according to the Property Appraisal Report settled by a neutral expert
Documents Required for a Non-Resident Mortgage in Turkey
- A proof of Income for the last 2 months: showing your salary. In case you run your own business, a document from your accountant will be needed.
- A residence document: a certificate from the Registration Office in the home country, or a copy of a bill for electricity or telephone usage displaying the address of residency. What is important, the bill has to include the surname of the person who is applying for the loan.
All of the mentioned documents have to be either in English or translated into Turkish by a sworn translator.
What is significant, to obtain a mortgage process obviously a Turkish bank account is needed first. You can read more about this procedure in our separate part describing how to open a bank account?
Financing and Buying a Property with Payment Plan
Some of the construction companies provide the customer with credit possibility. We call it a payment plan. It is an advantage offered to increase the feasibility of real estate sales.
Usually, there is some down payment percentage obligated to be paid at the beginning of the transaction. It varies and depends totally on the company. If you will decide to use this kind of debt, the construction company will encumber the title deed with the remaining claim as a hypothec. At first, some of the construction companies request a down payment of 35% of the property price, others up to 70%. Later on, the rest of the amount can be paid with an instalments payment plan within 12 to 60 months. Sometimes it can be less, sometimes even more. In the end, the construction company will take the hypothec off, after the full payment is done.
Advantages of Purchasing a Property with a Payment Plan:
- Interest-free generally for one year, but it depends on the construction company
- The interest rate is usually lower than the bank mortgage rates
- No extra records are wanted
- You can always complete the payment sooner than the deadline
- Get the keys right away and pay the rest within the accepted payment plan
- Usually, a payment plan possibility is provided for off-plan real estate, thus you can profit from this advantageous financial opportunity while waiting for your house to be completed
If you are interested in this kind of advantage while becoming a real estate owner, here are some interesting properties for sale in Turkey with a payment plan that we have listed on our website.
TERRA Real Estate, The Real Estate Expert in Turkey
Regardless of where you prefer to buy a property in Turkey, the beauty of the country will always amaze you. Just choose where to buy real estate in Turkey in coherence to your budget, your lifestyle, and expectations.
When you have decided to buy real estate in Turkey, make sure that you have a reputed estate agency with good references and experience. TERRA Real Estate is a committed business member of the Association of International Property Professionals (AIPP) and is regulated by the Property Ombudsman.
We recommend that you seek independent financial advice when considering any financial product. All of the information herein is intended as a general guide and not a detailed document of terms and conditions. Furthermore, it does not form any agreement or contract in part or full which you may enter in at a future date with TERRA Real Estate or its associated companies and partners.
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