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Mortgage solutions by ExpatMortgage

Our activities

The services offered by ExpatMortgage cover arrangement of new mortgage loans for funding purchase of real estate, as well as mortgage refinancing solutions. We cooperate with majority of banks and building saving societies operating in the Czech mortgage market. Our mission is to arrange for our clients the most advantageous mortgage and financial solutions at the best conditions attainable in the market while relieving our clients of the related administrative burden.

 

Products we offer

1. New mortgage

We cover the whole process of mortgage financing:

• Finding and tailoring the best solution for financing of your property
• Looking for the most favorable conditions
• Negotiations with banks and all authorities involved
• Full administrative support including real-estate appraisals
• Establishment of special purpose companies (if needed)
• Full assistance until the mortgage draw-down

Specifics of property purchase by foreigners in the Czech Republic

• Under the current legislation, foreigners are allowed to purchase real estate as individuals only if 1) they are citizens of EU member state and have temporary residence permit in the Czech Republic, or 2) have a permanent residence permit in the Czech Republic.
• In other cases, real-estate can be bought through a company, specifically established for this purpose. The company is fully owned by the individual person having thus control over the purchased property.
• Mortgage is consequently provided to and drawn by the company itself. Despite the loan is provided to the company, banks are screening the credit standing (income) of the company´s owner(s).
• The loan is secured by pledge on the property and shares of the company.

Mortgage standards

• Loan To Value ratio (LTV) – Amount of the loan provided by a bank in relation to value of the property. Usually 70-80% but also up to 100% may be available in the market depending on the overall creditworthiness of the client.
• Property Value – One of the decisive criteria for determination of the loan amount. The property value is set based on appraisal prepared by valuation expert approved and contracted by the particular financing bank.
• Credit standing of the applicant – Banks assess the appropriateness of the loan to be provided based on the applicant´s:
  • own regular and sustainable net income
  • income to be generated by the property
  • source of income
    • as an employee or as self-employee
    • from the Czech Republic or abroad
  • ability to document the income
  • track record
  • existing liabilities e.g. consumer loans, overdrafts, credit cards, leasing, etc.
  • existing assets
• Maturities - range from 5 to 30 years, but the mortgage loan always to be repaid no later than at 65 years (exceptionally 70 years) of the applicant´s age.
• Interest periods – Period during which the Interest rate is fixed (typically 1, 2, 3, 5 years, sometimes 10 or 15 years are available). After the Interest period expires, the bank sets a new rate and customer can partly or fully repay the loan without any additional costs. Choice of the interest period is up to the applicant based on his specific needs and financial outlook. Banks usually offer various Interest rates for different Interest periods. Some banks started offering new flexible mortgage products in which repayments (at no additional costs) are possible any time during the Interest periods.
• Interest rate - Interest rate offered by the bank depends on all the above-mentioned factors including current market rates, creditworthiness of the client, Interest Period, LTV, and Maturity. Current rates in the Czech Republic range usually between 4.5% and 6.5% p.a.

2. Mortgage refinancing

• With expiry of Interest period of your existing mortgage you are exposed to a risk that your Interest rate will be significantly increased by your bank. Many banks often propose to their existing clients much worse conditions than those available in the market and provide a very short time for alternative solutions or negotiations.
• In these cases we are able to provide consultancy and flexibly arrange for refinancing by another bank usually under significantly better conditions available in the market.

3. Other products

• Building society savings and loans (available only to foreigners with permanent residence permit in the Czech Republic)
• Pension and life insurance
• Property insurance
• Investments into mutual funds
• Consumer loans and Credit Cards

Our services and solutions

• Free of charge professional consultancy and full administrative support
• Complex and up-to-date overview of all products and conditions available in the market
• Cooperation with all mortgage banks and building saving societies
• Most advantageous conditions available in the market for our clients due to sizeable volumes of loans we realize with banks
• Streamlined and standardized process for all paperwork
• Establishment of a special purpose company if needed for the particular case
• No additional costs and significant time and cost savings for our clients (the lowest interest rates and fees paid to banks and minimization of other related expenses)
• Long-term experience in the area of financial products and in negotiations with banks
• We are ready to meet you in your office, home or in our premises as per your preference