Finance for Turkish property
If you have a good credit history and proof of income, then you will be eligible for finance for buying a Turkish property. If you can register a title to a Turkish property, there are mortgages available.
These are the steps you will go through:
1. First you must obtain an agreement in principle. This tells you what the provider will most likely be able to lend you, based on particular terms and conditions. No documentation is necessary at this stage.
2. Once you have decided on a particular Turkish property, you need to complete a mortgage application. At this stage, the lender will need to see proof of income, proof of identity and your address. Most lenders will run a credit check at this point.
3. The lender will then value your property to ensure the price you’ve agreed is reasonable and to make sure all legal requirements are met.
4. If the lender is satisfied with the valuation, you’ll receive a formal finance offer. Once the offer is signed and returned, the lender is obliged to provide the finance. Some Turkish lenders will require you to sign at a local bank branch in Turkey.
5. Once you’ve received your formal mortgage offer, your solicitor will organise a date for the transfer of title deeds. This process depends on the completion of the military application.
What rates are available for Turkish mortgages?
Finance is available through Turkish Lira (TL) and Euros. Interest rates applicable on TL mortgages are currently (as of Feb 2013) around 9%pa and Euro rates are around 4.5%.
Maximum loan to value is 70%, which means a minimum 30% deposit needs to be put down. However, since the mortgage market in Turkey is fairly new, surveyors are overly prudent. Typically, you will find that Turkish valuations are generally around 10-20% below market price. This means that in reality, you will be more likely to need a 40-45% deposit.