How to Get a Mortgage to Buy an Apartment in Poland: Belarusian Case

At first glance, it may seem that getting a mortgage in Poland is difficult, unclear, and possibly expensive. But Reloaction.io is ready to help and deal with all bureaucratic issues. We will make the process of legalization and adaptation after moving more pleasant and faster!

Can a foreigner get a mortgage in Poland?

Sure thing! Yes, in Poland, foreigners have the right to apply for a mortgage. However, the possibility of obtaining a long-term real estate loan is influenced by many factors: from personal credit history to the bank's conditions, which do not grant loans to everyone.

Not all banks offer the option of applying for a mortgage to foreigners or even citizens from outside the European Union, but the list is still decent: Alior Bank, BPS, BGŻ BNP Paribas, Credit Agricole, ING Bank Śląski, Bank Millennium, Pekao, PKO BP.

What You Need to Get a Mortgage in Poland

Each bank has its own conditions, which may vary. For example, fixed or floating interest rates, mortgage terms, and financing ranges. Here, however, we will consider the general documents and conditions that most banks request. It's worth noting that in each specific case, the bank may request additional data and documents to confirm solvency and make a decision on the loan application.

To apply for a mortgage, you will need:

• Completed application form at a bank branch or online (processing time usually takes about 2 weeks)
• Temporary/permanent residence card
• PESEL
• Income certificate for the last 3/6/12 months (for indefinite contracts)
• Annual contract and income statement for the last 3-6-12 months (for fixed-term contracts)

Mortgage for contract holders is available only after 6 months of employment. This is also related to tax residency – a mortgage in Poland is available only to individuals who have become tax residents here.

• Tax declaration PIT for the last 1/2 year (for those conducting business in Poland)

For individual entrepreneurs, the requirements for obtaining a mortgage are stricter than for employees with an employment contract. The main reason is the risks associated with entrepreneurship. Remember: Individual Entrepreneurs in Poland bear full financial responsibility for their obligations with all their property as individuals.

• Bank statement for the last 3/6/12 months
• Certificate of no tax arrears
• Permission to purchase real estate from the Polish Ministry of Interior - for those wishing to purchase a private house, land plot, agricultural objects, or real estate in the border zone.

Foreign citizens do not need to obtain permission from the Ministry of Interior if they:

• Have permanent residency status (permanent residence or EU residency) for at least 5 years;
• Are spouses of Polish citizens and have been in the Republic of Poland based on permanent residency for at least 2 years preceding the purchase (in this case, the property must be joint ownership with the Polish citizen);
• Inherited real estate, provided that the previous owner was the owner or perpetual user for at least 5 years.

Permission from the Ministry of Interior is also not required for the purchase of garages and separate apartments (Lokal mieszkalny). However, permission may be required for the acquisition of a share in an apartment.

In addition to the above documents, insurance is often required for both the loan recipient and the real estate object. The future borrower may provide information about compulsory insurance, but the bank has the right to demand extended policy conditions, meaning additional insurance may need to be purchased.

What helps to get a positive decision on the application?

A positive decision on a loan application is more likely for foreigners with a legal and confirmed source of income, long-term commitments, and extended documentation. And this is logical, because if a person has been living and working in Poland for a long time, they have more reasons and opportunities to settle here. Therefore, the following factors primarily influence a positive response:

• Permanent employment contract - this confirms that the employer trusts the employee, and therefore the bank can trust such a person. However, applications with other civil-law contracts may also be approved!
• Credit history in the Polish Credit Information Bureau (Biuro Informacji Kredytowej, BIK) - firstly, its presence in Poland, and secondly, its quality. If a person has consistently paid installments and loans before applying for a mortgage, it means that the bank can trust them with larger transactions. Therefore, before applying for a mortgage, it is worth considering building a reputation as a conscientious borrower.
• Permanent residency card - this is indeed a long-term commitment. Permanent residency confirms that the person has already gone through the stage with temporary residency and is inclined to continue living in Poland for a long time. Some banks initially require the presence of a permanent residency card to grant a mortgage.
• Income level - the higher the income, the larger loan amount one can qualify for. But here, expenses are also important. For example, marital status and the number of dependents.

Even with all these conditions met, a positive outcome cannot be guaranteed. The client's creditworthiness also depends on factors such as age, source of income, place of residence, presence of credit cards, as well as loan repayment terms and other financial obligations.

Conditions for Mortgage Borrowers

Despite the overall possibility for foreign citizens to obtain a mortgage, not everyone can take advantage of it. Restrictions exist due to residency conditions and the age of the applicant. Let's delve into the main conditions.

Loan Amount: This is the amount of funds the bank is willing to provide to the borrower. The size of the mortgage depends, from the client's side, on the cost of the desired property and personal savings (down payment). From the bank's perspective, the loan amount is calculated based on the borrower's steady income and expenses.

On average, banks are willing to provide 100,000 złotys for every 1,500 złotys of net monthly income. However, each family member being supported reduces the overall amount by the same 100,000 złotys. For example, a prospective property owner earns 9,000 złotys per month. If they live alone, they have a chance to get a loan for a sum of 600,000 złotys. However, if they have a spouse, the loan amount will be reduced to 500,000 złotys. With the addition of each child, the total amount decreases by another 100,000 złotys.

But the opposite effect is also possible. If the spouse and other family members are employed, their incomes are combined, and the loan amount may increase.

Age of the Borrower: Typically, loans are available to individuals aged 18 to 60-65 - that is, of working age. Banks may offer their own conditions for individuals aged 19-21.

In Poland, there are state programs supporting young families, which also provide opportunities for mortgage loans. For example, the "First Home" program, which is available to foreigners up to the age of 45 who have not previously owned real estate.

Currency of the Loan: According to the rules of the Financial Supervision Commission (Komisji Nadzoru Finansowego), the currency of the loan in the Republic of Poland must correspond to the currency in which the borrower earns income. Accordingly, if a foreigner applies for a loan and earns in złotys, the mortgage payments will also be in złotys.

Story of a Belarusian who Obtained a Mortgage in Poland

We spoke with a 25-year-old Belarusian who moved to Poland in late August 2020 and has already secured a mortgage. Artem (name changed upon request) settled in Wroclaw immediately and decided to buy property there:

"I started looking for an apartment in late summer 2022 and completed the deal in late December 22. I tried to search on my own from the beginning. When I called the numbers provided, 80% of the time it was an agency's phone, not the owner's. As a result, I bought on the secondary market, in a building from the 1970s, with the help of an agency.

For the transaction, I needed a residence card (it's desirable that it still has at least a year left), a work contract from the employer (for a minimum of one year). It's important for the bank that there is at least half a year left on the employment contract at the time of the transaction, or even better, permanent employment with an indefinite contract. A certificate from the employer showing the salary for the last 6 months is also required (these are the conditions for Santander Bank Polska; some banks may ask for data for other periods), and a passport from Belarus. Additionally, the amount of the down payment is important. For me, it was 20% of the total property value.”

Artem shares that he chose the apartment based on financial capabilities, so it's not exactly in Wroclaw, but nearby:

"My property cost 240,000 zloty at the time of purchase. Initially, I paid 48,000 zloty for the property, additionally about 7,000 zloty for the notary, and another 1.5% of the apartment's value to the agency that helped with the search. When the bank approved the deal, I paid 365 zloty for the commission (prowizja) and 3,850 zloty for home insurance (ubezpieczenie) - these are insurance expenses.

So, initially, to buy a two-bedroom apartment near Wroclaw on a mortgage, you need to have around 68,000-69,000 zloty.”

The Belarusian shares that his mortgage is for a term of 30 years, with the repayment amount revised every 3 months. Initially, Artem needed to pay 1,700 zloty per month, but now it's just over 1,300 zloty.

It's a variable-rate loan, but you could also opt for a fixed rate for 5 years upfront. Which option is better? It's better to calculate both, compare the analytics from recent years, and consider that the zloty is currently strengthening, while mortgage rates are rising.

Artem recommends paying attention not only to the numbers but also to the living conditions:

"If you decide to buy property not in the city center, consider the local transportation, car expenses. If you have children, consider the availability of schools, kindergartens, and infrastructure. This is really important because commuting to work and back is a routine that will be with you every day.”

Among the advantages of a mortgage, Artem highlights the cost and the opportunity to have your own home:

"The mortgage amounts are not as high as they are made out to be. And often, it's even cheaper than renting. Plus, every month I pay for my own home, not to a landlord.

I bought my apartment with relatively good furniture and normal household appliances. Apartments are usually sold empty here, but whoever searches, will always find!

A pleasant bonus: in Poland, there is the possibility to transfer the loan to another residential property. So, even if it's needed, long-term commitments (in my case, for 30 years) can be renegotiated later. For example, if my wife starts working, we can together transfer the loan to another, more expensive and higher-quality apartment.”

Artem also recommends:

• Before applying for a mortgage, consult with several agencies, seek advice from financial advisors (doradcy), who can help calculate creditworthiness, the possible loan amount, and find the most favorable conditions from banks.
• For those with an unfixed salary, obtain a certificate with the highest income, as this can increase the loan amount.
• Avoid buying property during peak sales times: before Christmas and New Year. During these periods, the number of transactions increases regularly, and property prices rise.
• Pay attention to the secondary real estate market, not new buildings, as prices for them, especially in big cities, are often high, and after purchase, renovation and buying furniture, household appliances are necessary.
• For those who prefer new buildings, consider offers from developers, not agencies.

We hope this information will be helpful!

And we believe that you will definitely find your home in Poland. For more detailed information on all local procedures, contact Reloaction.io at the link.