Below is an overview of investment finance available for real estate purchasers in Romania. Financing your property investment in Romania could entail injecting your own cash resources or, as most serious investors prefer, a mortgage or equity release scheme.
Although mortgages are relatively new to buyers in Romania, you can now obtain capital and repayment mortgages for 35 years or until age 70.
Minimum loans are normally for 5,000 Euros, while maximum loans can reach 500,000 Euros to finance 75% LTV. In order to qualify, your total debt should currently not exceed 35% of your income. However, times are changing and the Central Bank’s (BNR) decision to reduce minimum down-payments for homebuyers is paving the way for 100% mortgages and increased affordability for both local and international buyers. This move is of course expected to boost the real estate market, gradually pushing prices upwards by as much as 15%.
Many off-plan developments in Romania offer installment plans over between 12 to 60 months. The charges applicable vary according to developer and repayments are usually index linked. The developer can often offer the most competitive finance options to investors and these are certainly worth considering when looking at mortgage alternatives from their own countries.
As always, before making a commitment, we recommend you discuss your intended investment strategies for Romania with a lawyer, a reputable property agent with experience in the area and even a financial advisor.
Put simply, equity release is a way of releasing some cash from the home without having to sell up and move house. If you have property in your own country and would like to borrow against this in an equity release plan, we can introduce you to independent financial advisors who can help you raise the necessary finance for your investment property in Romania.
If you are in your mid-50s or older and own your own home, you may be able to get a cash lump sum, a regular income, or both, by using an equity release scheme based on the value of your property. These schemes can be helpful in certain circumstances to raise money for a mortgage to finance your property in Romania.
Not everybody falls into a category and some investors will need to raise alternative finance to equity release or mortgage options. There are other borrowing facilities available to purchasers of investment property in Romania.
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